Netflix India Strengths, Strategies, Weaknesses, and Suggestions

Netflix Case Analysis
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International Business Management
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Netflix Case Analysis
Introduction
Netflix, initially called "Kibble," was founded in 1997 by two Americans, Marc Randolph, and Reed Hastings, with the sole aim of offering rented movies over the internet. In 1998 the company had a fully operational online DVD rental, 300,000 subscribers, and relied heavily on the US postal services to make deliveries (Hosch, n.d.). In 2016, the company announced the launch of its services in 190 countries globally, among them being India. As of 2021, the company has approximately 209 global subscribers, increasing 16 million subscribers since 2020. Since joining the Indian market in 2016, Netflix has recorded significant progress, with its subscribers rising from less than a million in 2016 to roughly 5 million subscribers in 2021 (Hosch, n.d.). Some of the challenges Netflix has faced since joining the Indian market are the low internet access in the region and the high competition, especially from local companies such as Amazon Prime, Hotstar, Hooq, and Voot. However, the increasing internet access in both urban and rural areas since 2018 has played a key role in Netflix's increasing market penetration (Hosch, n.d.). While its revenues as still low compared to its competitors, it is slowly making progress and recording almost 2x growth every financial year. In the financial year 2019-20, the company reported a revenue of revenues of ₹923.7 crores and a net profit of ₹8.9 crores (Hosch, n.d.). Netflix India generates 93% of its revenue through local entertainment services and only 7% through export. Netflix as an international brand is slowly building its Indian brand, and its presence is slowly being felt.
The Current Situation of Netflix in India
With its entry into the Indian market in 2016, its main focus was developing indigenous content and acquiring streaming services' intellectual property rights. It has achieved much of its goals and has gone the extra mile to increase its expenditures with the sole aim of increasing its market share. The company is currently operating under the Netflix entertainment Services Indian LLP and has been a profitable entity since 2018.
Over the past few years, Netflix increased its local employee team to 100 and slowly introduced key strategies to surge its profits. For example, in 2020, the surge in the company's profitably attributed to introducing a mobile-only version of Netflix costing Rs 199 ($2.80) monthly subscriptions and exclusively for Indian consumers. Ideally, focusing on India-centric content has allowed Netflix to penetrate the market much faster and has slowly caught up with closest rivals. Some of the hit webs produced by the company over the few years include Delhi Crime, Jamari, Little Things, and Sacred. To increase its market, reach the company is currently integrating local interference such as Hindi into its websites and mobile application. More so, increased partnership with local networks such as Viacom18 has seen Netflix reach some of the most local audiences in India.
Netflix India vs. Netflix USA
The primary difference between Netflix USA and Netflix India based on formal institutions is that language, copyright restrictions, and content exclusivity create Netflix catalog movies between the USA and India. The USA Netflix movie catalog contains more than four thousand movies which often reduce or increase with time. On the other hand, the Indian Netflix movie catalog has a restricted number of movies at only about five hundred, creating a huge difference from the USA Netflix movie catalog (Hussain, 2018). The Netflix in-house Original Content production and the streaming entertainment service allow more than 1100 TV shows on the USA Netflix (Hussain, 2018). However, the number of TV shows available on Indian Netflix is only approximately five hundred. Thus, Indian users sometimes miss most TV shows on US Netflix, such as "The Flash" and the "Modern Family." The restricted number of movies and TV shows on Netflix India results from Indian culture. Indian people are highly restricted by their cultural beliefs, limiting them to the content they watch on TV shows and movies. Although there is a huge difference in the number of TV shows and movies available on US Netflix and Indian Netflix, the standard subscription cost has no significant difference. The USA Netflix standard subscription cost is about 7.9 dollars, and that of the Indian Netflix is about 7.7 dollars (Hussain, 2018). This shows that the formal institution price control is similar between the two regions. The primary informal institution difference between USA Netflix and Indian Netflix is based on the languages used in the content production due to the cultural differences between the two countries. Most USA Netflix content is produced in English-language, but translators are employed to translate the Content in other languages, especially subtitling (Hussain, 2018). However, most Indian Netflix content is produced in local languages such as Tamil, Bengali, Hindi, Telugu, and Marathi.
Hofstede's Cultural Analysis
Hofstede's cultural analysis of Netflix India considers the national culture of the Indian people who are the primary Netflix India market. There are six Hofstede national culture dimensions: power distance, individualism versus collectivism, masculinity versus feminine, uncertainty avoidance, indulgence, and long-term and short-term orientation.
Figure SEQ Figure \* ARABIC1: Hofstede cultural dimensions between US and India
The indulgence dimension indicates that societal norms restrain the Indian culture. This explains why Netflix India is highly restricted by the Indian culture, especially when it comes to languages and the Content in the TV shows and the movies available on Netflix India (Venema, 2019). India has a high score of long-term orientation due to its high acceptance of different religions. Therefore, there is a high level of cultural diversity in the country, allowing Netflix India to have rich and different Content based on the different religions in the country.
Hofstede's uncertainty avoidance dimension indicates that India is a highly tolerant society, and it easily adjusts to unknown or unexpected events (Venema, 2019). This creates room for changes in Indian Netflix due to the willingness and the confidence to take risks despite the uncertainties. India is a highly masculine society in terms of success and power visual portr...