Coming from a time when we had torrent, 15-minute shows with 15-minute advertisements and month long waits for the movie DVD to be returned, Netflix sure was a breath of fresh air, proving to be a game changer for how people viewed content.
All seemed hunky-dory for Netflix till the challengers came to the ring. Where Netflix was charging INR 500 per month for subscription, Hotstar & Amazon Prime came in to grab market share at INR 1000 per year. For a price sensitive market like India, shifting was a no brainer.
But losing one-third market cap is no joke for a streaming giant. The steep decline came in after Netflix reported having lost 200k subscribers with a projection of losing 2 Mn in the following quarter.
1. Netflix projected optimistically not realising that the anomaly that was the pandemic did accelerate subscriptions, they were a third short of their projections and a long way short of investor expectations.
2. A fall in demand for Netflix originals, with content being a key driver the 7% fall for their originals sure did leave a bruise.
3. Having to compete on price, content and releases with all players be it other giants like Hotstar and Prime or the myriad of other players breaking in like Zee5, SonyLiv, AppleTV & Voot.
So, what next?
Well, to drive subscriptions Netflix is already operating at lower price points, has just added a gaming segment to drive stickiness, for operational efficiency it is finding a solution for its password sharing problem (for real viewers are estimated to be twice the subscribers) and to drive revenue it is also planning to build in advertisements like other players.
Will it go back to being a front-runner?
Judging by how the gaming industry is poised to grow and with no other OTT player setting foot in that direction, Netflix could storm its way back in specially with metaverse in the picture.
Even otherwise it does have potential, simply because no one forgets their first romance and Netflix most definitely was a first for many.
So, until then Netflix and chill (no, the phrase isn’t dying ever).