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Will Netflix Conquer Bollywood Next?

netflix - Will Netflix Conquer Bollywood Next?

Source: Vivian D Nguyen via Flickr (Modified)

Netflix (NFLX) stock has more than doubled over the last 12 months, and its subscriber growth chugged higher along with it. This year, for the first time ever, the company’s tally of international subscribers outnumbered the number of Americans with a Netflix subscription.

Also this year, CEO Reed Hastings predicted that the company’s next 100 million customers will come from India, Bloomberg reported. Fittingly, the company has also begun ramping up its production of original content from the country. Its chief content officer Theodore Sarandos has been talking of making big-budget Indian television and is in the process of making at least six more original shows for the country, some of which include some of the biggest Bollywood stars.

Netflix Is Working With Bollywood to Create Content

For those less familiar, Bollywood is just one type of Indian cinema and refers to the Hindi cinema industry based in Mumbai (formerly Bombay). Its movies featuring a lot of fantastic colors and amazing dancing. The current Netflix catalog, of course, is primarily English titles, raising the question: Could Bollywood be the next frontier for original programming and, in turn, continued growth?

This month, Netflix is releasing its first drama series featuring Bollywood stars Saif Ali Khan and Nawazuddin Siddiqui. The series, called Sacred Games, was funded in Mumbai and is largely in Hindi. Netflix also has close to 20 projects on tap for next year, reports show.

This quote courtesy of Bloomberg, from Erik Barmack, head for international original series at Netflix, sums up the general direction of Netflix nicely:

“We’re becoming a global distribution platform for Indian content. The one thing we’ve seen that we want to steer away from is the idea of global TV being a French cop and an Italian cop and having them speak English.”

The main hitch in Netflix’s potential plan to go after Bollywood next is competition. Not only is its market lagging other providers, Amazon (AMZN) Prime included, but  Netflix is expensive relative to the rest of the Indian entertainment market.

The Bottom Line for Netflix

As we reiterate for countless companies, Netflix doesn’t necessarily have to win Bollywood to benefit from it. And while content creation is expensive, it’s helped Netflix prove many critics wrong already and has arguably become a prerequisite to its growth. Original content in expensive investment, but as the NFLX stock price shows, it appears to be paying off.

If the company can indeed win over Bollywood fans, you can bet those international numbers will continue to expand — and that the stock price will continue to follow suit.

As of this writing, Robert Martin was long AMZN.

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