iWorld

Netflix, Amazon may contribute to rising production cost in India

https://www.indiantelevision.com/sites/default/files/styles/smartcrop_800x800/public/images/tv-images/2018/05/03/Netflix_Amazon.jpg?itok=pNeVwH0n

MUMBAI: Netflix and Amazon Prime Video are known for loosening their purse strings when it comes to production cost. The threat of driving up costs is already looming over the Hollywood industry. As the OTT giants have begun to mark their territory in India, there is a concern that production cost may rise here as well.

Recent reports state that Netflix and Amazon are throwing money to lure top talent from Hollywood. In addition to that, Netflix is also driving up Hollywood salaries by offering big pay rises. Traditional players have been sweating it out in competing with the rising cost. Netflix’s $300 million deal to poach Ryan Murphy from 21st Century Fox was a classic example of this development. Robert Kirkman, the creator of the hit show The Walking Dead, signed a two-year deal with Amazon last August.

Both companies have renewed their focus on India and, in order to understand the market, it is likely that they will look to poach talent from rival companies. The quest to offer premium content will also lead to higher production cost.

When Eros Digital COO Ali Hussein was asked if because of Netflix and Amazon’s higher investment the overall cost of Indian ecosystem will go up or not, he said though there’s not a definitive answer to this. But, in general, the cost will definitely go up. Along with that, he also feels that it depends on how smartly the work is being done in the existing ecosystem to have a certain amount of control over the cost.

“If in any business, the demand is high, the supply chain cost will go up. Across all businesses, when there is a large demand for episodic or original web content, how do you ensure you are able to maintain a certain quality of production with a growing talent pool? It’s not just the cost of the celebrities or directors, it is the technical cost and that of the entire process,” says Hussein.

ALTBalaji CMO Manav Sethi thinks the cost has already increased due to international players splurging but the output quality has not increased much. In addition to that, the companies have less understanding of the Indian market, which has unorganised, segmented content making.

According to Bodhi Tree Multimedia founder Mautik Tolia, the increasing number of productions from Netflix and Amazon will not have any short-term impact on overall production costs. This is because the volume of content being produced at the moment by the duo is very limited compared to overall content production in India.  It will only drive the premium talent costs upwards such as A-list actors and directors. But at the same time platforms are providing opportunities for new and fresh talent, making the content creation process more inclusive and might actually bring down the talent costs as a fresh pool of talent will get injected in the system. “It all depends on what path the platforms will take forward whether they emulate the traditional studio systems going for safer bets with established stars and directors or punting in and promoting new talent. This remains to be seen,” Tolia says on the possible future scenario.

However, one of the main reasons for spending more money on production is to increase premium quality content. “Overall, I believe that content quality in digital both for domestic as well as international players is improving and there will be a premium for quality content,” Arre co-founder Ajay Chacko says.

Endemol Shine CEO Abhishek Rege also thinks Netflix is only shelling out money to get premium content. “Costs in digital will be higher than that of what we see in television because digital needs better quality of content,” he says.

Where there’s a fear that Netflix and Amazon may shake up the Indian ecosystem like they are doing in Hollywood, the scenario is less viable in India despite the fact that production cost will definitely go up. Indeed, the streaming giants will aggressively try to acquire top talent from the industry but other OTT players can opt for fresh talent. In the next four to five years, the traditional players, including Bollywood and broadcasters, will face a tough challenge from these international players. However, with new content strategies, the cost can be controlled to a certain level.

Latest Reads

https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/05/Airtel-Bharti%20Airtel.jpg?itok=lEUbfoXc
Bharti Airtel to raise up to $3 billion

The board of directors of telecom player Bharti Airtel Ltd approved the telecom operator’s proposal to raise up to $3 billion in account of the issue of overdue fees it owes the government.

iWorld Telecom
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/04/Netflix.jpg?itok=6gUsjdMn
Netflix available in more than 300 mn pay-TV households

MUMBAI: A new report from UK research firm Ampere Analysis has said that Netflix is available in more than 300 million pay-TV households. It also added that more than 50 million of those have come during 2019. The reach through Pay TV partnerships is almost double the company's current global...

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/04/digital-media.jpg?itok=57evATmW
Esports, streaming wars, shopvertising to dominate digital media trends in 2020

Technology will continue to disrupt and reshape the digital media industry in 2020, presenting new opportunities and challenges for advertisers and media owners. While digital media will continue to grow globally, the coming of new technologies, platforms and digital touch points will force...

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/03/tvf.jpg?itok=8LU2Lrwd
TVF launches new series ‘Cubicles’ in association with DSP Mutual Fund

MUMBAI: Walking its talk to launch new innovative shows, pioneers in digital content and entertainment, The Viral Fever along with leading asset management company, DSP Investment Managers Private Limited is all set to add a new original to its repertoire with the release of TVF Originals ‘Cubicles...

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/03/jio.jpg?itok=Gx0G0YDu
Jiocinema to bring Sun NXT’s South Indian blockbuster catalogue to Jio users

MUMBAI: JioCinema, the on-demand video platform yet again surprises millions of Jio users, especially the South Indian Movie Buffs! In association with Sun NXT, the online video streaming platform from Sun TV Network, JioCinema will present the best of south Indian movie catalogue to Jio users...

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/03/shemaroo.jpg?itok=KIDIlh0c
Shemaroo Filmi Gaane hits the record-breaking mark of 30million subscriber base

MUMBAI: Another feather added to the cap of India’s leading content powerhouse Shemaroo Entertainment. Its leading YouTube channel Shemaroo Filmi Gaane hits an outstanding mark of 30 million subscriber base. Shemaroo Filmi Gaane YouTube channel is the 5th most subscribed channel in India and...

iWorld Social Media
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/03/1.jpg?itok=1COFNGrr
Continuously launching content targeted at different taste clusters ensures good retention: ZEE5's Aparna Acharekar

Among the home-grown over-the-top platforms, ZEE5 has shown most aggression in creating its original content library. As a part of its content strategy for the upcoming year, franchises will play a key role along with a line-up of nearly 20 original films.

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/02/vmate.jpg?itok=3GllsZLj
VMate to incubate 1 lakh video creators from Bihar

MUMBAI: VMate, a trending short video platform, organized a 3-day bus tour for creators meet in Bihar covering Muzzafarpur & Patna to announce its focus on the state for incubating around 1 lakh talented video creators. During the creators meet, the top 12 VMate creators who are earning more...

iWorld Over The Top Services
https://www.indiantelevision.com/sites/default/files/styles/340x340/public/images/tv-images/2019/12/02/Akamai.jpg?itok=qpw0pPlu
Preventing content piracy in the cloud era

Sacred Games Season 2, an original Indian series by Netflix, ended up being one of the many victims of rampant content piracy in India. The series was available on illicit websites and other digital mediums on the internet even before the original content was made available.

iWorld Over The Top Services

Sign up for our Newsletter

subscribe for latest stories