Netflix vs. Amazon Prime Video

netflix-vs-amazon-prime-video

This streaming service has stepped up its efforts to get a huge piece of India’s booming video-on-demand market, where it has fallen behind local players and Amazon’s Prime video service.

So far, it looks like Amazon has the finest understanding of the pulse of the Indian customer as it has stored up and estimated 9.5 million Prime Video subscription holders there since releasing in December 2016, while Netflix is estimated to be suffering at just 4.2 million subscribers despite being in India for over a year.

The development of Netflix in India has been hindered by premium pricing (Rs. 500 per month fro normal definition, or $7/75 at the recent exchange rate) and a limited content library. Amazon, on the other hand, provides its video subscription service as part of Prime for around $8 a year. So, it does not make sense for a customer to select Netflix given the shortage of content.

However, Netflix is now looking to patch its main faintness to make its service more appealing to Indian customers.

In India, Netflix steps on the gas

Netflix is allegedly ramping up its speculation in India this year to drum up more content and compete with Amazon’s ever-developing online library. The online streaming could spend as much as $300 million on fresh, India-absorbed content, according to livemint.com. Netflix had initially made just 7% of its entire library available in the Indian market, providing it a vital setback in obtaining subscribers.

But it is now ready to stream its first India-particular comedy special — Abroad Understanding — featuring well-known Indian actor and comedian Vir Das. This is the first original production from India to be featured on Netflix worldwide, and should perfectly lead to subscriber development as comedy is the second-most viewed genre in India.

Moreover, Netflix users in India can begin streaming content produced by Red Chillies Entertainment and Viacom 18 Motion Pictures – India’s two popular production houses — from the recent quarter onward. The Red Chillies deal will permit Netflix to exclusively stream thirty motion pictures, along with any new films produced over the next three years

CEO Reed Hastings currently said that India is mainly a film-centric streaming market, so it won’t be astonishing to see Netflix pursue violent content affiliations in this space. What’s more, the online streaming supplier is also taking steps so that Indian customers can relish more content using fewer data.

Netflix’s dynamic optimizer technology will allegedly permit subscription holders to stream 30 hours of content at the expenditure of just 2 GB of data, without cooperating the obvious quality of the content. This will be useful in the Indian context as data costs are high as equal to other countries.

This streaming service has been slow to grow its content library in India as Amazon Prime Video has taken the market by the tempest. Amazon has a different library of above 50 Indian motion pictures and is on track to produce 18 fresh original shows for this market.

What’s more, the e-commerce giant is allegedly going to spend $75 million this year on growing India-particular content, having already knotted up with 15 production houses in the nation. Moreover, Amazon’s investment toward increasing local content is greater than that of domestic competitors Hotstar and Voot, showing its aggressive posture in this market.

Amazon’s enhancing content library and reasonable subscription plan provide it an intrinsic advantage over Netflix, and the gap may broaden if the latter doesn’t do something about its rating. Of course, Amazon will grow the price of its Prime service in India to INR 999 (approximately $15.50 at the recent exchange rate) per year once the introductory offer is over. But even then, it will be much reasonable than Netflix, which might find it hindrance to increasing its subscriber base despite big investments.

Competition is tough for Netflix in India

Netflix in India

With tough competition from local and worldwide players in the nation’s Rs1.26 lakh crore ($19.2 billion) media and entertainment industry, the American video streaming giant has identified that was battle life ahead.

CEO Reed Hastings shared his words earlier this month, “There’s a great battle with Hotstar, YouTube, and Amazon and many others, all competing for a consumer’s time. We are one of the choices, but what’s unique about Netflix is that we’ve got an international titles combined with great local talent”

This popular streaming company, Netflix is recently up against 29 other OTT content givers in India, according to the currently launched Media and Entertainment Industry Report, 2017, by KPMG India and the FICCI. And its subscription numbers tell that there’s a lengthy way to go before Netflix can match rivals such as Hotstar of Star India.

The hugest drawback is likely to be Netflix’s steep pricing. Hotstar premium subscribers pay only Rs.199 (monthly), compared to Netflix’s beginning rate of Rs.500. And Amazon Prime video charges an annual fee pf Rs.499 for unlimited video access, as well as [rime delivery for orders on its e-commerce podium.

While the KPMG India-FICCI report doesn’t identify whether Netflix’s active subscriber have all paid Rs.500 or more, an analysis by news website Medianama recommends that the company has only between 200,000 and 300,000 paid subscribers in India. It based this on an appropriate information response got in February.

Here’s how Medianama explained its methodology:

The LTU (Large Taxpayer Unit) has given response that Netflix paid Rs.20 crore in taxes for January 2017. We divided this number from the service tax rate that this streaming service charges for the high rate plan, and the rate they charge on their least costly plan. With this, we arrived at a range of subscribers, between 211,500 and 337,300. Since there are three different plans, it is unlikely that either utmost in the range is close to the number of subscribers that Netflix has in India, so we were supposing that the number is somewhere between 2 and 3 lakh.

Local content and mobile first

Another velocity bump for Netflix in India is that a number of local media networks, counting Zee TV and Viacom18, are releasing their own podiums. Ozee TV and Voot, for instance, typically have more native content. And with smart device perforation spreading to the hinterlands in India, mobile is turning to an essential channel for video utilization a big bless for local channels.

A video recently accounts for 60% of mobile data traffic, according to the KPMG India-FICCI report, and mobile video is guessed to increase at a compounded yearly increase rate of 63% between 2016 and 2021.

The report did the addition, “In India, the number of video-capable devices and connections are expected to grow 2.2-fold between 2016 and 2021, reaching 800 million in number”

But the content of Netflix in India is still very city-centric, and making inroads in rural India could take various years for the Los Gatos, California-based firm. For now, this popular streaming service has tied up with Red Chillies Entertainment of Shah Rukh Khan and comedian Vir Das for an original show to serve to the local audience, but this might not be enough. Moreover, swifter 4-G-based internet services, counting Reliance Jio, are making live sports a great hit on mobile phones, and that’s a category in which Hotstar has an edge.