Netflix, Inc. (NASDAQ:NFLX) Is In No Hurry To Go To China


Netflix, Inc. (NASDAQ:NFLX) recently expanded to major countries of the world except China. The central question that followed was when would it expand to China? According to Netflix’s CEO, Reed Hastings, he stated that the company was not in a hurry to expand into the Chinese market. He specifically stated “We have a very long-term look. It could be a many years discussion, or it could happen faster than that.”

China has a population of approximately 1.35 billion people and a high economic status. This means that if Netflix could expand to this market and get the right approvals, they might become owners of one of the largest customer bases. The main catch is that companies not located in China, usually find it very hard to enter the market. Hastings went ahead to compare Netflix entrance to this market, as similar to as Apple Inc. (NASDAQ:AAPL)’s iPhone entrance. He noted that Apple took many years to get the necessary approval to sell its products in this market.

Hastings also stated that if they are looking out for a business a decade from now, they would have to exercise patience and continue to build on already established relationships and learn from them. Hasting Noted if Netflix were to enter the Chinese market, it would be forced to abide by same government mandate content rule as other Western and Chinese companies. This law mandates that all services should be offered on a level playing field.

Hasting stated that the expansion of Netflix to 130 new countries gave Netflix more than enough on its plate. It has lots of places where it has to work on building an audience.

Netflix is currently dealing with the challenge of cracking down on ‘unblockers’ who have circumvented the restriction on where shows and movies can be streamed. Most of the audience outside the US becomes very vocal after the company stated this but according to Hastings; He does not think this move will in any manner affect worldwide subscribers, which currently stands at 75 million. He stated this when the company released its fourth-quarter earnings.