The largest video
subscription service provider in the world, Netflix, Inc.(NASDAQ:NFLX) began
its operations in Sweden. It is its debut in the Nordic region. It has further
plans of expanding its limits beyond the US.
The online services are
charged at 79 kronor a month, which is equivalent to $12. The package includes
TV shows and movies from Warner Bros., Twentieth Century Fox, Sony Pictures and
many other content providers. The service can be enjoyed live in places like
Denmark, Finland and Norway later this week, as per Reed Hastings, CEO of Los
Gatos, Netflix based in California,
Netflix has been streaming
videos to its US customers since 2007. It is now expanding its business in
Europe as the competition intensifies and weighs hard on its home market. Its
service will experience tough competition from Modern Times Group AB’s Viaplay,
Time Warner’s HBO and Amazon in the Nordic regions that has a population of
about 25 million people.
Hastings mentioned in an
interview that the company has planned on investing heavily. It has more
content this time than it ever had during a launch.
Hastings also said that in
all of the markets of Netflix, it invests for the long term and does not really
decides on breaking even in a new market in a span of 2 years. Usually it takes
longer than 2 years since the company keeps on investing so as to get more
content and build the best service possible.
Netflix also plans on
expanding to Latin America, the UK and Canada. It does not expect a new region
to be profitable for at least the first two years.
There is no reason why
Netflix should update its forecast for a fourth quarter loss resulting due to
expansion costs. Netflix usually invests about $12 billion every year on content,
as per Hastings.
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