Global entertainment company Netflix says its bet on India is working. In a conversation, Netflix's co-CEO Ted Sarandos, said India is its fastest growing market with engagement up 30 percent and revenue up 25 percent . While Netflix doesn't report country-specific numbers, Sarandos said the firm has seen an acceleration of growth in India, which he describes as an "incredibly vibrant market, going through a very exciting time"

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While India is looking good for Netflix, it got off to a rough start in 2022, with a drop in subscribers, the first in a decade. The company attributed the loss to the Russia & Ukraine war, as Netflix pulled the plug on its operations in Russia, like many global corporations.

In a letter to shareholders, it did also acknowledge challenges on account of slower sales of smart TVs and increased competition. Sarandos believes the worst has passed, with 2022 closing on a much stronger footing. Netflix reported quarterly numbers in January 2023, that were ahead of Street estimates with the company adding 7.66 million paid subscribers in the fourth quarter, compared to the expectation of an addition of 4.57 million subscribers. This was also the first quarter that saw Netflix's ad based service being accounted for in its earnings. Ad tier, is Netflix's strategy to grow its subscriber base at a lower price point.

Sarandos said the ad tier strategy will make marginal money in 2023, but see significant headroom for growth and meaningful revenue contribution over the next three to five years, as they roll it out across different markets. India is not part of the ad tier roll-out strategy for now. However, Netflix has already taken a price cut in the market.

Even as some other entertainment companies have announced scaling back budgets, Netflix is sticking to its content budget of $17 billion. Again, while not sharing numbers for India specifically, Sarandos said the company will spend proportional to its growth and has a strong pipeline of content across original local content and licensed content. "Cinema infused content" is working well for India said Sarandos and Netflix will continue to focus on "entertainment" and not content that could be seen as "polarising".

The global success of RRR and Elephant Whisperer, titles on Netflix that have all made the Oscar Shortlist, have certainly reignited India's aspiration of creating crossover content. Sarandos believes, RRR could be a key "trigger" to make that happen and Netflix would like to be "an exporter of Indian content"