Netflix is to launch its streaming video subscription service in the Netherlands by the end of 2013. No exact details have been revealed about the price, device availability and the exact launch date; however we expect that Netflix will offer the service at a price range and via the same devices as in other regions. Netflix monthly subscription price typically falls into the $5-$12 range internationally, depending on country.
The company is understood to be planning to offer both local and international content including films, acquired TV series as well as original Netflix series such as ''House of Cards''. Consumers in the Netherlands who want to become Netflix customers can register now on the company's website and will get an email when the service goes live.
Netflix started its expansion in Canada (2010), moving onto Latin America (2011), the UK and Ireland (at the beginning of 2012) and most recently the Nordic region (at the end of 2012). As of Q1 2013 the company had 6.33m paying subscribers internationally, approximately 19 per cent of its total paying streaming subscriber base.
International expansion has incurred higher than expected levels of costs for Netflix, pushing the company to postpone its entrance into new markets until the end of 2013. The Q1 2013 'contribution' from international business (revenues less content acquisition and marketing expenses) was a loss of $77m. Although much less than the quarter before ($105m) when the company entered the Nordic region, it still remains significant.
In the case of the UK and the Nordic region Netflix faced developed markets with large numbers of established online video players. In the UK, Netflix experienced high growth levels in its subscriber base but in the face of strong competition from Amazon's Lovefilm and from incumbent pay TV operator BSkyB. In the Nordic region the company has also seen high growth levels, but as with the UK, faces established SVOD competitors including Modern Times Group-backed Viaplay, Filmnet from (C-More and TV4) and a number of SVOD offers from local broadcasters, such as TV2 Sumo (Norway) and TV2 Play (Denmark). While the level of competition in the UK and Nordics has helped Netflix raise awareness of its services, it has also driven up costs - both in terms of content acquisition and marketing.
In the case of the Netherlands however, Netflix is moving into a market composed solely of niche local VOD players such as Ximon, Videoland, multiscreen services from pay TV operators such as UPC and Ziggo, and transactional movie services from big international players such as Apple and Microsoft. The subscription business model has not been widely used by video content providers yet, leaving an apparently open market for Netflix - although it is unlikely that the incumbent pay TV players will simply stand by and watch. In addition, while being a relatively small territory, the Dutch market has other attractive features for Netflix, including a developed broadband infrastructure (with one of the highest household broadband penetrations globally), high personal wealth and a reasonably media/tech savvy consumer base. Netflix will still have to invest into high quality content to ensure its offer is attractive enough to secure subscribers, but should have a slightly easier run than it has had historically when entering new markets.