We will get into vernacular Indian content step by step: Netflix CEO6 min read . Updated: 09 Dec 2019, 07:40 AM IST
- Hastings is sure of winning over the country eventually through content investment of ₹3,000 crore in 2020
- On the sidelines of the Hindustan Times Leadership Summit, Hastings spoke about self regulation, the impact of streaming on films
Ever since American streaming platform Netflix entered India in January 2016, its founder and chief executive, Reed Hastings, 59, has been a regular visitor to the country. India not only fascinates him —he toured Rajasthan in a luxury train with 60 Netflix employees on his first visit —but he sees a big potential in this market. Netflix has less than 2 million subscribers in India and is trailing way behind market leader Hotstar and even Amazon Prime Video. However, Hastings is sure of winning over the country eventually through content investment of ₹3,000 crore in 2020. On the sidelines of the Hindustan Times Leadership Summit, Hastings spoke about self regulation, the impact of streaming on films and why streaming platforms don’t require external viewership ratings. Edited excerpts from an interview:
India is still a niche and very small market for you. Do you see a potential that makes you come here so often?
A niche of 1.3 billion people? It’s a pretty big niche. It is a great opportunity for us as there are so many people who love content as India has a very long movie tradition. We are building up with premium television and the big success has been finding series such as Sacred Games and Delhi Crime that get watched not only here but also all around the world. And one example of that is Mighty Little Bheem—that child character. This Indian baby is now famous throughout the world. We have had more than 27 million households who are now watching the Indian character. A big focus is investing in content here and sharing it around the world.
Globally, you plan to spend about $15 billion on content. What percentage of that would be in India?
Indeed, we are spending about ₹3,000 crore in India this year and next year in content. That is about $400 million.
How would you describe a typical Netflix viewer in India? Are you connecting with the millennials? What kind of audiences are you targeting?
A lot of our content is in English because it is developed in the UK, though it is dubbed and subtitled. However, I would say we have an elite skew of people at this point who like our content from UK, US, France, or Germany. We are also developing much more local, original Indian content. Over time that will really help us appeal to people throughout India.
In one of your earlier visits you said that you wanted 100 million people out of India to subscribe to Netflix. How far are you from that goal and how do you plan to reach it?
We will reach it going one million at a time. So, 100 million is a great number for us to think about. There are now 600 million people on the internet so there is lot of room there. The big thing changing is smart televisions, Android TVs. They used to be very expensive but now for about for ₹10,000 you get a beautiful television with all kinds of apps—Hotstar, Amazon, and Netflix. That is really opening up the market for internet streaming television.
How do you take a call on what kind of content will work for an audience? Is it based on consumer research?
We really learn by doing. All our content creators have independent power to greenlight, commission and invest in projects. So, we have stories such as Delhi Crime, which did well. We have Season 3 of Little Things that just came out, which is doing very well. So, we say okay, now we understand the audience a little more. So, we learn by creating new content.
Do you balance content that pushes the envelope with those that are more conservative? Do you believe in self-regulation?
We really believe in artistic freedom. We want to back our talent to make a story they really believe in. Then, on the service, it has got ratings, mentions what age is appropriate and what it has. So, it has a lot of parental control. We want our members both in India and around the world very diverse in their taste to be able to know what they are getting, to be able to control that. That is what makes it so different from broadcast television.
In India, have you faced censorship or has the government asked you to censor part of your content?
The government has been working with the whole industry—Hotstar, Zee, us, Viacom, and others to have a self-regulatory code. That’s what governments around the world are doing, which is—let’s have some great stories but let us give families the control they want in their homes. That’s the key interest.
How do you plan to compete with new platforms such as Apple and Disney?
We have been competing with Amazon for more than 10 years around the world and for three-four years, here in India. Disney, of course, has been enormously successful. They recently bought Fox and Hotstar. They are investing a lot too. (We’re competing) really by just focusing on our members and what stories we should be telling. They will have some great success I am sure. That’s okay. People will subscribe to shows they want.
Do people subscribe to multiple streaming platforms?
Sure. Some of them do, just like they subscribe to multiple newspapers. If there is some great content, they go on for three months here and three months somewhere else.
Why don’t streaming platforms have a third-party viewership measurement system like television? There’s a certain lack of transparency in the number of subscribers they have.
One of the best things about Netflix is it does not have advertising, it doesn’t have commercial interruptions. All of that (television) industry is about advertising. That’s why there are those ratings to support an advertising model. We don’t have an advertising model. So, we don’t have to bother with any of that. We just have to work very hard to please our members with new content. We had a series Lust Stories, which was very popular here. Now, we have one coming up Ghost Stories on 31 December. As Lust Stories was very honest about sex, this is very scary. I think it will make a great New Year’s Eve.
Streaming has disrupted the television broadcasting business globally. Do you think it is now affecting the theatrical revenue for films?
Not at all. In the US, Netflix is very large—about 60 million households. Yet, movie theatre revenue hit a whole new record. The way it is, you can have a music service on your phone but you still go to a concert. Or you can cook and you still go to restaurants. So, movie theatre business is great when you want to go out, when you want to watch with other people. However, that doesn’t mean at home you can’t have great content from Netflix.
You have been pushing for narrowing the window between theatrical release of a film and its release on streaming, which could kill the film industry.
Yes. It is very controversial because, for a film, the movie theatres think they want an exclusive (right) on content as opposed to us wanting to bring our content to our members and letting it go to the movie theatres at the same time. We are really focused on how we please our members.
What is the next big technology that could disrupt this video-on-demand business?
Video-on-demand is just starting. The internet is getting stronger and stronger. More and more of the big entertainment companies are moving to streaming. I think the next 10 years is probably really building up the streaming ecosystem and providing consumers with many options.
In India, are you happy to keep Netflix, a niche, elite product?
No. We want to grow into being the fantastic producer of many genres of Indian content. First, we have to be very strong in Hindi and English. Then, get into Telugu and Tamil and many other vernacular languages. However, we will take it step by step.