Netflix announced today that its movie streaming service will be available in 43 countries in the Caribbean and Latin America later this year. Members will be able to access Netflix.com in Spanish, Portuguese or English on a range of Netflix support devices. Interested users can leave their contact information with the company and receive reminders when the service is ready.
What does this mean for Netflix? Foremost, it is adding a huge new potential user base to its market demographic. Technology and content companies that do well in the era of Web 2.0 have significant sources of traffic in international markets, such as Facebook and Twitter which both have 70% or so of users overseas. The move will further cement Netflix as a go-to source for streaming content on the Web. With all the competition in that area, that will be huge for Netflix going forward.
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The biggest thing that Netflix can do for itself is to make the company an invaluable resource to movie studios. The more users that Netflix can generate, the more likely it will be able to sign content partnerships with the major studios at terms that are favorable to Netflix. In turn, that will enable Netflix to provide its service at its current rate ($7.99 a month to start) without having to jack up rates to afford content licenses.
We have contacted Netflix about which countries are specifically included in the Latin America and Caribbean rollout and will update this post if/when the company responds. The prize of the region would be Brazil, a country that is rapidly developing a first-world economy and sparking technological innovation. Brazil has 15 cities with a population greater than $1 million and a total population of 190 million, the majority of which speak Portuguese. If Netflix is not coming to Brazil in this expansion, it is laying the groundwork to debut in the country by providing streaming service in Portuguese.
“Netflix members in the U.S. and Canada have really taken to watching instantly and we feel great about being able to offer the same combination of convenience, choice and value to people in Mexico, Central America, South America and the Caribbean,” wrote Jessie Becker, VP of marketing for Netflix in a blog post.
It is telling that South America is mentioned by Becker but no specific mention of Brazil. It also looks like Netflix with be streaming-only in its expansion. The logistics of DVDs by mail to 43 countries across a large geographic region is cost that Netflix would probably like to avoid.
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