Recognising the high potential for growth in India, and to overcome the pressure to localise content, the world’s largest video-on-demand services company - Netflix is planning to put up a production facility here, according to an article in the Business Standard.

India is estimated to have 500 million smartphone users and 650 million internet users by 2020 translating into significant growth for the video-on-demand industry despite relatively higher data costs and low speeds.

Netflix is working on strategies to take on rival Amazon Prime Videos, which has already managed to gain popularity with Indians.

“We are already building our production capabilities outside the United States. Today, we are filming local shows in 13 different countries, including India and Japan,” said Netflix Chief Content Officer Ted Sarandos speaking to investors.

To get a sense of the content that Indian audiences seek, Netflix CEO Reed Hastings made his maiden visit to the country in March, met various participants of the industry, and announced a few tie-ups like one with Shah Rukh Khan’s production house Red Chillies Entertainment.

Netflix also started producing its first original series in the country -- an English-and-Hindi-language adaptation of author Vikram Chandra’s book Sacred Games -- in partnership with Anurag Kashyap’s Phantom Films.

While the investment on these original shows at Rs 500 crore is the highest outside the US, it is still way lower than the Rs 2,000-crore budget set by Amazon for its Prime service.