Whilst most famous for its glossy US dramas, in the last four years Netflix has made several high profile (and expensive!) commitments to developing more internationally varied content.

The streaming service’s push to expand into new markets is paying off: of the 9.6 million subscribers Netflix added in 2019 Q1, 7.9 million were from outside the US. With 60% of its subscriber base now non-US, and growing, the streaming service is having to adapt and develop content to reflect the tastes, and languages, of its new audiences.

¡Hola España!
According to Netflix CEO, Reed Hastings, being a “local producer” matters. Whilst Netflix acquire many of their originals at the distribution phase, the company is keen to work more closely with film and TV makers throughout production. The company spent $1 billion on originals in Europe in 2018, and announced an intention to produce up to 100 non-English shows in the continent a year by 2020. 

Netflix launched its first European production hub in Madrid earlier this year. The business case for Netflix’s new location is obvious; Spain is the second largest producer of TV fiction in the EU, producing 1,509 hours of content per year. The new facilities at Ciudad de la Tele campus should help Netflix capitalise on this talent, and conveniently, contribute towards meeting the new Audiovisual Media Services Directive’s quota for on-demand services to offer 30% European content. 

Furthermore, with Spanish language content the second most watched after English, programming from Spain has massive export potential. Netflix original, La Casa de Papel is the service’s most watched non-English show globally, and has experienced significant success even in non-Spanish speaking countries such as Saudi Arabia. The show has met critical acclaim internationally, becoming the first series from Spain to receive an Emmy International last year, taking the prize for the “Best Drama” category.

From Hollywood to Bollywood
But Netflix has an international strategy that stretches far beyond Europe. In an address at the Economic Times Global Business Summit in New Delhi late last year, Hastings was clear about where the future growth of the service lies: “The next 100 million [subscribers] for us are coming from India”. 

After launching in the country in 2016, Netflix initially struggled to gain traction due to a limited content library with little regional programming. Acquiring and developing India-specific content that resonates with audiences will be key to attracting customers from local streaming platforms, most notably Disney-owned market incumbent, Hotstar, which boasts 300 million monthly active users. Netflix aired its first original series in Hindi in 2018; Sacred Games follows the story of a policeman facing a terrorist threat to Mumbai. Featuring famous Bollywood stars, the show marries a combination of Western and Indian styles clearly aimed at a young, wealthy audience. The success of this helped Netflix gain 1.2 million subscribers, but much more will be needed to effectively compete with the vast content libraries Hotstar inherited from parent broadcaster Star India. A further 15 Indian originals are planned for release by 2020.

Crossing continents
However, the returns on Netflix’s increased investment in local content is not restricted to those markets: a number of titles have had extraordinary success outside their own countries. For example, Brazillian dystopian thriller ‘3%’ is highly popular across North and Central African countries, whilst German show ‘Dark’ won unexpected audiences in Bangladesh, Chile and Canada – with 9 times as many hours streamed internationally than at home. Looking at viewing trends across the world highlights some interesting cultural affinities: Turkey is the second largest TV exporter in the world after the US, and has a massive following in Latin America. Last year at least 4 four of the top 15 shows in Chile, Peru, Panama, and Uruguay were Turkish, with not even a single American contender.

Sharing the Netflix effect
Since launching its first foreign language original Club de Cuervos in August 2015, Netflix’s international originals have seen considerable success. Filmed in a combination of Spanish and Mixtec, Alfonso Cuaron’s 2018 Roma, an arty black and white story about a Mexican housemaid, achieved a record number of Academy Award nominations for a non-English language film and won three prizes, including Best Director.

Netflix’s international strategy is providing massive economic stimulation for TV production worldwide – spreading the Netflix effect outside the Hollywood bubble. La Casa de Papel alone has had a transformative effect on the Spanish audiovisual industry: the show led a 50% increase in global requests for Spanish fiction in the first quarter of 2018. Whilst the OTT phenomenon has without doubt shaken TV markets, if Netflix feels localised original content is going to be essential for further growth, this could be an exciting opportunity for local content and content makers to gain exposure far beyond their traditional geographical distribution.