After years of persistent efforts to gain a foothold in this complex market, Netflix’s Q2 2024 report reveals that these efforts are finally showing tangible results. India contributed the second-highest net subscriber additions globally, with Netflix reaching 12.7 million subscribers. This achievement had been long awaited, as Netflix had invested significant effort in introducing targeted plans, like the Mobile-Only plan, specifically designed for India’s price-sensitive consumers. However, despite this progress, Netflix's reach remains small when compared to the vast potential of the Indian market. With over a billion people and a rapidly growing internet user base, 12.7 million subscribers barely scratch the surface. India’s OTT market is a challenging battleground for global players, where regional diversity and cultural complexities create significant hurdles. To succeed, platforms like Netflix must go beyond broad strategies and deeply understand India's diverse audience to craft localised solutions that resonate with different regions. The Underwhelming Growth of India’s SVOD Market Netflix’s recent success in India may suggest that the Indian SVOD market is finally gaining momentum. However, this success masks a more complex reality. Unlike mature markets like the U.S. or Western Europe, where slowdowns typically signal saturation, India’s market is still in a state of transformation. Many consumers remain hesitant to pay for content, and the assumption that India’s expanding middle class would rapidly embrace SVOD services has proven to be overly optimistic. From 2019 to 2022, the SVOD market experienced rapid growth, but momentum slowed in 2023 with a 4% decline primarily driven by changes in how cricket is consumed. Once a premium feature on Disney+ Hotstar, cricket moved to JioCinema, where it was offered for free, significantly reducing paid subscriptions. Although major players have introduced mobile-only plans tailored for price-sensitive consumers, adoption has been slower than expected. We project a modest 7% CAGR from 2024 to 2029. Considering the anticipated 811 million 5G subscribers and the relatively slow expansion of fixed broadband, this growth rate is underwhelming. The causes of the market's underperformance are multifaceted. First, there is a low willingness to pay for OTT subscriptions, especially when most consumers are accessing content primarily on smartphones, which remains the dominant device for OTT consumption in India. Many users are accustomed to free or ad-supported content, making it difficult to convince them to pay for premium services. Additionally, there is a noticeable mismatch between the content offered by global platforms and the preferences of Indian consumers. As audiences increasingly seek hyper-localised content—often in their native languages and reflective of regional cultures—global players have struggled to meet this demand. An Ultra-Regional Market: How Local Platforms are Outpacing Global Competitors While internet access is rapidly expanding across India, it’s important to recognize that much of this...
