- Latest earning reports reveals that Netflix revenue crossed $20 billion annually.
- It took around 22 years to cross $20 billion marks.
Netflix’s 167+ million user base has generated more than $20 billion this year. Started in 1997, a 22 years journey is now finally paying well to the company. Netflix 150 paid subscribers, invest more than $15 billion every year
Experts have to say that not only new subscribers have gone up, but existing user’s spending (in-app purchases) has also gone up.
Walt Disney Co. is the same business for 74 years and it took around 72 years to achieve the same milestone which Netflix has already achieved in 22 years.
How Netflix Revenue Crossed $20 Billion Mark:
Let’s throw some light on probable reasons why this OTT app is doing amazingly (not only in terms of content creation but in revenue and ability to make their viewers nuts):
- A report revealed that users spend most of their time on non-gaming apps like Tinder, Netflix, and others. Users are spending 35% of more time on mobile devices as compared to 2 years ago.
- If we only talk about the Asia region, Netflix is a huge success here. In the Asia-Pacific region, Netflix revenue reached $1 billion last year.
Out of all the reasons, Netflix gains a competitive advantage when the OTT platform restructures itself according to the international market it is in.
For a price-sensitive country like India, Netflix rolled out its mobile-only plan in India seeing that most of the viewers from India prefer to watch TV series while they are stuck in a metro. Netflix launching a mobile-only plan for INR-199.
“We’re in our early days still in India and the market potential there is enormous, It’s a very unique market in the sense that it’s very mobile heavy, and while figuring out the mobile-only plans, both economically and from a service standpoint, we found them to be kind of revenue-neutral to positive, and a way to get broader distribution in India,” Ted Sarandos, chief content officer, Netflix.
Then recently, Netflix announced that its annual plan can be subscribed at a 50% discount. After receiving huge success, to penetrate more and stay connected with the users, Netflix is working out to launch a long-term subscription plan in the country.
All this definitely contributes to the ever-growing growth of Netflix in India, Asia and globally.
Netflix ended its 4th quarter with 167.1 million total subscribers (up from 139.3 million last year). Bloomberg analyst Geetha Ranganathan said in a research report “Netflix was helped by a blockbuster content slate which included a strong line-up of hit shows like The Crown and You”.
OTT platforms have raised the level of Indian TV Series. Our favorite Sacred Games is under the list of Top-30 global TV shows
Netflix’s revenue not only talks about its business and earnings coming from the global user base, but it has actually reshaped the media landscape and user’s preference for watching TV shows. Netflix’s budget for original content is expected to reach nearly $19 billion this year, as compared to $8.5 billion for Amazon Studios, $6 billion for Apple TV+ and $2.5 billion for Disney Plus.
Seems like Netflix is very clear about how they are going to spend their revenue. While others are seen spending more on the advertisement, and market strategies, the platform is spending a decent amount of content creation (which is its core focus)
“We have a big head start in streaming and will work to build on that by focusing on the same thing we have focused on for the past 22 years – pleasing members,” Netflix CEO Reed Hastings.
Building on its vision to provide entertainment across shores, Netflix has grabbed 100 million paid memberships outside home territory US. Outside home, Europe, Middle East & Africa, Latin America and the Asia Pacific regions.
Another strategy contributing to Netflix revenue is that its local original TV shows were most popular in many countries including India. Kora, Japan. Turkey, Thailand, Sweden, and the UK.
“Out of the 7.7 billion people on the planet, only 1.5 billion speak English to some degree and about 371 million are native speakers. And yet, historically, the majority of entertainment content in the world has been produced in Hollywood in the English language. It’s in that disconnect that we see a tremendous opportunity, the majority of Netflix’s 139 million (then) members are from outside the US, a ratio that is going to get bigger in the years to come. And you see that shift in the kind of original programming that we are doing,”- Greg Peters, chief product officer at Netflix
Viewers are also going crazy for The Witcher – launched last month, is now the best viewed season 1 TV series on the platform.
Conclusion:
While other OTT platforms struggle to get attention from viewers, it’s Netflix is ahead in the race. In fact, Zee is said to follow Netflix’s strategy to increase the flow of revenue.
One thing is clear and transparent. Even after Netflix revenue crossed $20 billion, they don’t seem like stopping their continuous innovation towards original content creation.
This is one big reason why Netflix is ahead of all OTT platforms globally in terms of revenue and in some countries it’s even ahead in terms of the user base.
Netflix revenue crossed this mark is yet to achieve a lot more than its present achievements. We wish all the best to Netflix.
