India Becomes Netflix’s 2nd Largest Market in Paid User Additions in June Quarter

• ByStartupStory     |    July 19, 2024

Netflix has announced that India became its second-largest market for paid user additions in the June quarter of 2024, bolstered by a robust content slate in the country. This significant milestone was highlighted in a letter to shareholders, which also noted that India ranked as the third-largest country in terms of revenue growth percentage for the quarter. However, specific subscriber or revenue numbers for the Indian market were not disclosed.

Globally, Netflix added 8.05 million subscribers during the second quarter of 2024, with 2.83 million of these new users coming from the Asia-Pacific (APAC) region. The APAC region, which includes India, was Netflix’s largest geography in terms of member additions. The region’s revenue grew to $1.05 billion, marking a 14.5 percent increase from the same quarter last year. Overall, Netflix’s revenue rose to $9.56 billion for the quarter, reflecting a 16.8 percent growth over the previous year.

In April, Netflix announced plans to stop reporting quarterly paid membership additions starting from Q1 2025. The company explained that the multiple pricing tiers across various markets mean that each incremental paid membership has a different business impact.

“We’re focused on revenue and operating margin as our primary financial metrics — and engagement (i.e., time spent) as our best proxy for customer satisfaction,” Netflix stated in the shareholder letter.

Driving Factors for Netflix’s Growth in India

The growth in India was driven by several successful original titles, such as Sanjay Leela Bhansali’s “Heeramandi: The Diamond Bazaar” and Imtiaz Ali’s “Amar Singh Chamkila,” during the quarter. Additionally, licensed films like Kiran Rao’s “Laapataa Ladies” and the Ajay Devgn and Madhavan-starrer “Shaitaan” contributed to the streaming service’s expansion in the country.

“Heeramandi” was highlighted as Netflix’s biggest Indian drama series ever, with 15 million views during the quarter. The title has been renewed for a second season in June. Meanwhile, “Amar Singh Chamkila” registered 8.3 million views during the quarter. Netflix defines a view as the total hours watched for a title divided by its runtime.

“I think India’s growth is a story that we see around the world playing out similarly. So you look at the content, the product market fit is what drives our ability to attract members and retain members and monetise with them as well… If we pick them well, we programme well, we improve the product market fit, we improve engagement, we grow members, we grow revenue,” Netflix co-CEO Ted Sarandos said in a post-earnings video interview.

India has emerged as an increasingly vital market for Netflix’s future growth, serving as a key content hub for the platform. This comes amid a rising appetite for digital content among consumers in the world’s second-largest Internet market. However, India’s price-sensitive nature has posed challenges for the streaming service to gain a significant foothold, especially with rivals offering services at lower prices. Netflix had reduced its prices by 20-60 percent in India in December 2021.

The streaming giant is also set to face stiff competition in the country, following Reliance Industries’ joint venture with Disney, which combines the businesses of Viacom18 and Star India. The deal includes JioCinema and Disney+ Hotstar, two of India’s top streaming services.

In April 2023, Sarandos had said that India is a “big prize” because it has an enormous population of entertainment-loving people and they will “ultimately do great” in the country.

In February, Netflix unveiled its 2024 content slate for the Indian market to strengthen its offerings. The slate comprised 22 titles, including eight films and 14 series. New titles include a docu-series on the cricket rivalry between India and Pakistan called “The Greatest Rivalry – India vs Pakistan”; a limited series on the 1999 Kandahar hijack titled “IC 814: The Kandahar Hijack”; and a documentary on the life of hip hop artist and rapper Yo Yo Honey Singh called “Yo Yo Honey Singh: Famous.”

Netflix will also offer new seasons of several popular series, such as “Mismatched Season 3,” “Yeh Kaali Kaali Ankhein Season 2,” and “Fabulous Lives vs Bollywood Wives.” The third season of “Kota Factory” debuted on the platform last month.

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