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Netflix Launches in Cuba

9 Feb, 2015 By: Erik Gruenwedel

City street in Havana, Cuba

SVOD pioneer marketing $7.99 service in a country where the average Cuban doesn’t have Internet access and monthly salaries average $22

Netflix Feb. 9 announced it launched its subscription streaming service in Cuba — one of the first American companies to bow business in the Communist country.

Netflix original series available include “House of Cards,” “Orange Is the New Black,” “Marco Polo,” DreamWorks Animation’s “All Hail King Julien” and “The Adventures of Puss in Boots” and Academy Award-nominated original documentaries “Virunga” and “The Square.” Netflix is also offering a wide range of films, series and kids programming, as it does throughout Latin America.

“We are delighted to finally be able to offer Netflix to the people of Cuba, connecting them with stories they will love from all over the world,” Netflix co-founder and CEO Reed Hastings said in a statement. “Cuba has great filmmakers and a robust arts culture and one day we hope to be able to bring their work to our global audience of over 57 million members.”

While the easing of travel and business restrictions between the U.S. and Cuba is progress. The reality is that Netflix — even at $7.99 a month — is a luxury to most Cubans. The monthly salary reportedly is around $22 a month.

Most citizens do not have access to an international payment system (i.e. credit card) to pay for Netflix. In addition, the Communist country is one of the least wired countries in the world with broadband — a requirement for streaming — all but nonexistent outside of government circles.

Indeed, Netflix, which began offering service in Latin America in 2011 and now counts more than 5 million subscribers in the region, has encountered myriad challenges in the region — the majority involving a dearth of consumer credit and consumers willing to use credit cards.

To Wedbush Securities analyst Michael Pachter, Netflix in Cuba is purely a public relations spin.

“[Netflix] can’t get to 200 countries without Cuba, so it’s a step toward that goal. This is no longer about subscribers or profits, it’s about getting complicit media types to hype every word that comes out of [Netflix’s] mouth,” Pachter said in an email.


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