Why Netflix has to set up office in Mumbai and not Bengaluru

By Sreeraman Thiagarajan, Agrahyah Technologies

The FAANG vs BAT is getting intense in India, for the uninitiated, the acronyms stand for Facebook, Apple, Amazon, Netflix, & Google and Baidu, Alibaba, & Tencent.

The similarity among these companies is that they package cutting edge technologies into consumer-facing products to a level where even a baby can use. They have habit-forming experiences that becomes addictive over a period of time; they seamlessly integrate content and commerce and smoothly take money from you which a click or in case of Apple, with just your eyes looking directly at the front camera of an iPhone to pay.

Perhaps this level of seamless experience offered to end consumer explains why enterprise facing tech companies like an Adobe or Microsoft or even a Cisco is not on the list (ever configured a Cisco router without tech support?)

FAANG companies are not just disruptive in tech, they are impactful at the Street; they are tracked and indexed especially on New York Stock Exchange as NYFANG; their empire is vast and spread around the world, and they dominate with near monopolistic powers that are virtually unchecked.

All of them are taking India seriously and rapidly working to grow the user count here. Their office is typically set in tech resources rich corridors like Bangalore and Hyderabad, except Netflix, who is believed to have leased 1.5 lac square feet of office space at a rent of Rs. 47 crore per year to set up their India head office in Mumbai’s BKC, a premium business district. Even Sweden based music streaming app Spotify is in Mumbai. But why?

Unlike Google or Facebook, Netflix does not just aggregate, and display content created by a third party or what the industry terms as UGC (user-generated content). A wedding selfie posted by you on Facebook or a hand-held camera panning across the Jog falls will suffice to be called as engaging content on Facebook and YouTube respectively, but Netflix needs PGC or professionally generated content that can only meaningfully secured if they set shop in the city of dreams – Mumbai.

If the Hollywood has TMZ or the Thirty Mile Zone in Los Angeles as the Mecca of content and entertainment productions, Mumbai has a Veera Desai road and a Fun Republic Lane, a tightly packed 3-mile zone housing all major Bollywood and content production houses including Balaji Telefilms, Adhikari Brothers, Dharma Productions, Eros and more.

Recently, during the release of Sacred Games, Netflix even went the distance to stake a metaphorical flag of arrival here at the 3-mile zone that they practically took every billboard punctuating a dusty road that’s dug up for Metro.

The N of FAANG is here, but who will be stung? The UGC driven video products or other OTT players with original programming? Well, if India is a land of the snake charmers, I’m guessing one who knows how to play the proverbial Pungi in the right pitch aka right content at optimal prices will win.

(Sreeraman is co-founder of Agrahyah Technologies. Views expressed above are his own)