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YouTube bets on local content in battle against Netflix, Amazon

business Updated: Dec 09, 2016 12:38 IST
Sunny Sen
YouTube

Alphabet’s YouTube is in talks with some of India’s biggest production houses, television channels and studios, including Yash Raj Films, Shemaroo, Zee and Sony, and a large number of south Indian studios, to bring exclusive content for its Indian viewers.

Alphabet’s YouTube is in talks with some of India’s biggest production houses, television channels and studios, including Yash Raj Films, Shemaroo, Zee and Sony, and a large number of south Indian studios, to bring exclusive content for its Indian viewers.

“Some may bundle the content for YouTube-first, and then for television, some may tweak it for YouTube… There are 100-150 web series,” said Ajay Vidyasagar, Asia-Pacific regional director at YouTube.

In America, its home country, YouTube is facing competition from Netflix, the Californian entertainment company, and rival Amazon Prime. India, too, is not an exception.

In India, content upload grew 60% in 2016, against the previous year, while overall hours of content grew 10% to 12%. Globally, YouTube added 400 hours of content every minute to its platform last year.

Time spent on YouTube viewing in India went up 90%, compared to 2015 (the figure was 80% in 2015), and on mobile it was even higher – up 135% (110% in 2015).

But competition is knocking on YouTube’s doors -- Amazon has signed a deal with Dharma Productions for exclusive content, and there are more in the pipeline. What’s more, it will offer free, unlimited content to its Prime members. Netflix also, is closing in.

But Vidyasagar is not too worried. “Netflix is a high-value, low-volume business. Its reach is limited. They run a business where the content is created in one place and served across the world.”

Recently, Netflix launched its new show, The Crown, based on Queen Elizabeth-II, which cost $100 million, making it one of the most expensive shows on royalty.

But unlike Netflix, YouTube finds value in having large volume and diverse content catering to local needs.

“We are increasingly becoming a local player in every country – the default native video base is YouTube even in some small towns,” Vidyasagar said.

YouTube has already faced some backlash in India. Star World recently took its famous talk show, Koffee with Karan, hosted by Dharma Production owner Karan Johar, off YouTube, and began airing it on its own digital platform Hotstar.

”It did an extraordinary volume on YouTube… A few quarters down the line, they might look at the traffic,” Vidyasagar said.

However, as online video – a relatively small business in India – matures, people will look at different ways of monetisation. So YouTube is looking more at exclusive content. Some of the trending videos this year according to the company’s internal estimates were from YouTube creators, including All India Bakchod (AIB) and The Viral Fever (TVF).

In India, it will keep the business free, dependent on ad revenue. But it already has a Netflix-like subscription model in some countries. So, is it coming to India soon? “Not in the next few months,” Vidyasagar said.