YouTube is going to start making originals in its fifth largest market, Reuters reports. As the Google-owned video site’s traffic from India grows exponentially on the back of falling mobile data prices, it will target premium audiences with a subscription model as it does in the US with YouTube Red. The company is also hiring a development lead for the effort in India (H/T Ivan Mehta). Over 80% of Indian internet users — who are themselves around 10% of the total population — use YouTube, the company said last year. As multi-channel networks and other web video producers like PutChutney, AIB, TVF and others hit maturity, the subscription route is starting to make more and more sense to tap.

Advertising revenue for YouTube in India is low to begin with, compared to other markets. Since Indian users don’t have the buying power or even the numbers to match developed markets like the US and Japan, ad revenue per user is pretty low. Blognife, which runs an educational YouTube channel, averages around 1,500 views a day, but only manages to net around $2 per million impressions. In the US, that amount is over $15. Producing originals behind a paywall is the only new route for the company to bring in fresh revenues, in addition to the growing userbase it is getting with falling data prices.

The low budget webseries

Beyond the noise of premium webseries like Sacred Games and Bard of Blood on platforms like Netflix, there has been an underlying slew of low-budget series that are hugely popular. Starting from TVF Pitchers all the way to Dice Media’s Little Things (whose next season will be on Netflix), the low-budget webseries is a tried and tested model. Even Amazon Prime Video has a few such shows, like Going Viral Pvt Ltd, in addition to big ticket releases like the reality show Comicstaan or the drama Inside Edge.

YouTube’s productions will also presumably follow the template laid out by creators like TVF and OML in the production values for their shows, and for the monetisation targets they have for those titles. Susanne Daniels, who heads global original programming at YouTube, also told Reuters that they plan to execute this strategy in markets like Mexico, Germany and Japan. With products like YouTube Music, YouTube Red, and YouTube Premium, none of which are currently available in India, the infrastructure for distributing these productions is already in place. Now all that remains is the question of pricing, and whether enough Indians will subscribe to make the effort worthwhile.