Netflix Coming to the U.K., Ireland in Early 201224 Oct, 2011 By: Erik Gruenwedel
Streaming pioneer to bow European service in the U.K. after management-fueled scuttlebutt speculates it would launch first in Spain
Netflix Oct. 24 said it will bow streaming-only service in the United Kingdom and Ireland in early 2012 — ending speculation the service would bow its European campaign first in Spain.
Netflix has been streaming to U.S. members since 2007, adding Canada in 2010 and 43 countries in Latin America and the Caribbean in September 2011.
Los Gatos, Calif.-based Netflix, which has been streaming in the United States since 2007, added service in Canada in 2010 and 43 countries in Latin America and the Caribbean in September 2011.
Notably, Netflix's entry into the United Kingdom marks the first time it will encounter an already-established streaming service through Amazon-owned Lovefilm — heretofore Europe's largest by-mail DVD, Blu-ray Disc and streaming rental service.
In a call with analysts to discuss fiscal results, Netflix CEO Reed Hastings said consumers understand the value of Internet-based video entertainment. He said it is predictable that over the next several years there will be “many new entrants” in the subscription VOD space.
That said, Hastings said the recent launch of streaming through Blockbuster Movie Pass and increased profile for Amazon Prime has had no discernable impact currently on Netflix streaming.
Netflix CFO David Wells also questioned whether Lovefilm really is the first-mover in streaming in Europe as it was in by-mail disc rentals.
When asked why Netflix chose to enter the U.K. market, which also has video competition from Sky Go and BBC’s iPlayer, Hastings said Netflix would go after unique programming and TV content versus studios movies locked up by satellite TV operator Sky.
“Sky movies is expensive and only taken now by 5 million households,” he said. “So there is a big opportunity for those who don’t have Sky movies, and for those with Sky movies using our TV content selection to attract those subscribers. We see a very attractive market [in the U.K. and Ireland], with great over-the-top [OTT] penetration and many consumers are comfortable with online video and use it frequently.”