Netflix plans to complete its global quest by the end of 2016, and Russia, the largest country by area, is on Netflix’s list of next-year launches. Russian publication Izvestia reported that the streaming firm will begin operations in Russia starting in January, making its services available to over 142 million consumers there.
Netflix partners with a local firm
Citing industry sources, Izvestia said the service will become available on set-top boxes and smart TVs. Netflix and Russia’s leading long-distance telephony provider, Rostelecom, have entered into an agreement regarding TV set-top boxes and plan to make the service available by the next year. By the end of the third quarter of fiscal 2015, the telecom company had 3.1 million household subscribers.
SVOD or subscription video on demand is something new for Russians, but experts believe it will change the viewing habits of the nation as it offers superior quality in terms of service and content. Every month 6.9 million people or 11% of Russian Internet users watch smart TVs, according to TNS Global’s data. The annual growth rate of the audience in the region is 32%.
Original content to help win in Russia
In Russia, Netflix will have to compete with Amediateka, which also offers subscription-based streaming service in the region. However, there is a good chance that Netflix’s original content will help it lead the Russian SVOD market.
Even though the Russian market is relatively new with few dominant players in the SVOD industry, experts believe that Amediateka should focus on developing original content and that only then it will be in a stronger position to compete with the U.S. video streaming giant. On the other hand, Netflix will be able to succeed if it is able to offer the right content in a language that Russian viewers are able to easily comprehend
Presently, Netflix has its operations in North and South America, Western Europe, Australia, New Zealand, and Japan. In the current quarter, it began operations in Italy, Portugal and Spain as well. By next year, the U.S. firm plans to offer its services in Cambodia, Hong Kong, Singapore, South Korea, and Taiwan in Asia and South Africa.
On Wednesday, Netflix shares closed down 2.02% at $116.71. Year to date, the stock is up by over 139%, while in the last one month, it is down by over 5%.