Netflix: We Will Win Across the Pond
Netflix (NASDAQ:NFLX) CEO Reed Hastings is confident despite a mind blowing stumble in 2011. Hastings said in an interview the company expects to add millions of subscribers within a few years to its streaming video service that launched in the U.K. and Ireland today.
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The service costs £ 5.99 a month in the U.K. and € 6.99 in Ireland for unlimited video viewing. It offers films and television programming such as ‘Top Gear’ and ‘90210’ from content providers such as Disney (NYSE:DIS), BBC, CBS (NYSE:CBS) and Miramax.
The new service faces competition from Amazon’s (NASDAQ:AMZN) Lovefilm, free services such as 4oD from Channel 4, and iPlayer from BBC. Nevertheless, Hastings is upbeat, saying, “It’s so easy to use Internet television, we’ve got great content and it’s a very low price. Sure 4oD is free, iPlayer is free, Lovefilm is just getting into streaming. There’re a lot of opportunities in the market.”
The expansion into the U.K. and Ireland will cause Netflix to log a loss this year for shareholders. However, according to PricewaterhouseCoopers LLP, internet-streaming videos are forecast to be the fastest growing segment. Moreover, the subscription TV market in Europe, Africa, and the Middle East may expand as much as 24 percent to $95 billion in the next four years.
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