As it has been reported in the news, Netflix is expanding into the Caribbean and Latin America. In my opinion this move is well-timed and should help the company increase its bottom line.
Latin America consumers are very big on foreign and local media consumption. Plus, there is a huge void for a provider in the online video market.
Netflix shareholders (myself included) should be very excited about this move. Brazil, Argentina, and Mexico represent fast growing media markets and should help the company grow. Not to mention that after the expansion news broke out, Netflix shares were up about 8%.
It seems as though Netflix will follow an adaptation strategy by offering content in English and Spanish.
As opposed to the DVD rental model used in Canada and the US, Netflix will wisely not pursue this strategy in Latin America. They will only offer online streaming services. The reason for this is that the postal system in most Latin American countries is nowhere near the US Postal service and it would have caused the company significant logistical problems.
While the competition in the online video market in the US is intensifying, Latin America offers a very attractive opportunity for video providers to reach out to an audience craving for quality content. Netflix first mover advantage should prove, in the long-run, a very advantageous one.
No comments:
Post a Comment