Online streaming platform Netflix has signed a deal for an entire floor with WeWork’s Nesco coworking centre, purchasing new office space in Goregaon, Mumbai.
Sources close to the developments told Economic Times that the transaction for about 320 seats, was signed on June 30.
The new office space will be used by Netflix for visual effects work, a domain witnessing increasing demand across the country. The work will be carried out in collaboration with another company, Anibrain.
Last year, Netflix bought a space of 137,000 sq ft in Godrej Bandra-Kurla Complex
“The deal tenure is two plus one year with a lock-in period of 18 months. The employees operating out of Nesco complex will exclusively be aligned for Netflix work,” the people said, without disclosing its financial terms.
The WeWork Nesco IT Park in Mumbai spans eight floors, with a total seating capacity of 3,400 spread across 228,000 sq ft.
On July 6, WeWork signed a deal with internet technology company ByteDance, for a flexible workspace for 1,250 seats at WeWork Nesco in Mumbai. Surprisingly, the deal happened days after the Indian government banned 59 Chinese apps, including ByteDance-owned TikTok, citing threats to data privacy and security.
Earlier this year, WeWork also signed a deal with the Commonwealth Bank of Australia, for office space in Bengaluru.
As for Anibrain, the visual effects and animation studio has offices in Pune and the Andheri suburb of Mumbai, with around 700 employees catering to global clients, working on projects such as ‘The Aeronauts’, ‘The Secret Garden’ and ‘The Witcher’.
“Once the lockdown is lifted, it may take another two months for the Godrej property to go live. Netflix will also move from the existing co-working properties,” another person who is aware of the deal said.
Netflix also owns a flexible workspace for 100 seats at The Executive Center at Maker Maxity in the BKC and a 9,000 sq ft separate office in the same complex.
Netflix Eyes Expansion In India
The rapidly expanding presence of Netflix in terms of workspaces has a lot to do with the company’s India outlook. Inc42 earlier reported that the company was in talks with Network18’s Viacom18 entertainment network for a multi-year partnership to source at least 10 shows, mainly in Hindi.
In December 2019, Netflix partnered with Tipping Point, the digital content arm of Viacom18 Studios, to source three original series — ‘Jamtara — Sabka Number Aayega’, ‘She’ and ‘Taj Mahal 1989’.
In the last few years, the global video streaming company has been betting big on India — in terms of money as well as the content strategy for Indian viewers. Netflix founder and CEO Reed Hastings earlier said that the company will invest INR 3000 Cr to produce original content for the Indian market.
Hastings said that Netflix India content during the second quarter of 2019 wasn’t strong and that’s why it failed to attract new users to the platform. As the company looks to create more original shows, it is also looking at another essential for its video streaming— efficiency.
In India, a fundamental issue with large-format content creation has been a lack of efficiency in pre-production, leading to heavy dependency on post-production where the errors have to be corrected, thereby increasing costs and reducing the quality of content. Being one of the biggest producers of films and TV shows, the Indian industry faces issues with efficiency.
Netflix India recorded a net profit of INR 5.1 Cr in the financial year 2019, ending March. The company has registered INR 466.7 Cr revenue in total. Compared to FY18, Netflix has reported an 87% hike in revenue. According to the fillings by the ministry of corporate affairs, between September and March 2018, when the company transferred to a local distribution entity from Singapore, its turnover was INR 58 Cr with INR 20 Lakh net profit.