Netflix inches towards global dominance

Impact heralds the start of the new era of online streaming and Internet TV, says Ovum

Netflix inches towards global dominance

Netflix inches towards global dominance

Online streaming and Internet TV company, Netflix, has launched its service globally, simultaneously bringing its Internet TV network to more than 130 new countries around the world. The company made the announcement – and the service went live – during a keynote by co-founder and chief executive, Reed Hastings, at CES 2016.

“Today you are witnessing the birth of a new global Internet TV network.

“With this launch, consumers around the world – from Singapore to St. Petersburg, from San Francisco to Sao Paulo – will be able to enjoy TV shows and movies simultaneously; no more waiting. With the help of the Internet, we are putting power in consumers’ hands to watch whenever, wherever and on whatever device,” Hastings said.

For one monthly price, members around the world will be able to enjoy Netflix original series as well as a catalogue of licensed TV shows and movies. In 2016, the company plans to release 31 new and returning original series, two dozen original feature films and documentaries, a wide range of stand-up comedy specials and 30 original kids series.

Netflix has also added Arabic, Korean, simplified and traditional Chinese to the 17 languages it already supports.

“From today onwards, we will listen and we will learn, gradually adding more languages, more content and more ways for people to engage with Netflix. We’re looking forward to bringing great stories from all over the world to people all over the world,” he added.

However, Netflix will not yet be available in China, though the company continues to explore options for providing the service. It also won’t be available in Crimea, North Korea and Syria due to US government restrictions on American companies.

Ovum TV and OTT Video senior analyst, Tony Gunnarsson, said Netflix being switched on in 130 new markets has made it a “global network” available in more than 190 markets across the world. Gunnarsson added it makes #NetflixEveryhere a global reality, with the notable exception of the countries stated above.

“The impact of a global Netflix will be felt for a generation to come and heralds the start of the new era of online streaming and Internet TV. It is one of the biggest moves in home entertainment, perhaps since the launch of the DVD, and a major milestone in the evolution of video and home entertainment – #NetflixEverywhere is as bold as it gets,” he said.

But, he also said we’re not witnessing the end of traditional TV distribution.

“Nothing happens overnight. Contrary to popular perceptions, consumer habits actually change remarkably slowly. If Netflix will prove successful in all new 130 markets, it will still take Netflix years to build the level of subscriber numbers it has in Western Europe and Latin America.”

Ovum’s preliminary view is also that Netflix is likely to add up to around 10 million new subscribers in the new markets and perhaps another 10 million in its existing markets in 2016. As a result, Netflix may end the year with somewhere in the region of 85 million to 95 million subscribers globally (up from around 75 million in 2015).

“Ovum believes that real impact of the new 130 markets won’t be felt before 2017 or 2018 when Netflix will start to experience rapid growth in these markets.

“As this happens, it is very likely that Netflix’s international business will surpass its domestic operation in terms of subscriber numbers. Between now and 2020, Netflix is expected to have more than doubled its current total global subscriber count and be approaching the 200 million subscribers mark,” Gunnarsson said.

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Tags analysisinternet tvovumnetflixCES 2016

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