Netflix is looking to launch in Spain later this year, according to local media reports that were relayed by Variety this weekend. According to these reports, Netflix could launch in Spain as early as September. The streaming service has reportedly already negotiated rights to launch in Spain, and TV manufacturers are preparing to carry the Netflix app in Spain this year. Netflix executives announced earlier this year that they want to expand to 200 countries within two years.
Not having access to award-winning TV is certainly nothing new for cord-cutters, but now the debate’s being flipped: When Amazon’s original series Transparent won the Golden Globe awards for best comedy and best actor, there was some discussion of how the masses could see the show, since it’s only available on Amazon, to Prime members.
But here’s something a cable network would probably never do: On Saturday Amazon is making all of the episodes of Transparent free for viewing by all, just for that one day. In addition, in case you don’t have time to binge-watch the 10 episodes, [company]Amazon[/company] is putting Prime on sale that day for $72 (down from the normal $99), though it appears the offer is only available to new members. Amazon’s relying on you getting so hooked by episode 2 that you will have signed up for Prime by episode 4.
You can watch the show at www.amazon.com/Transparent or on the Amazon Instant Video app.
Netflix wants to complete its global expansion within the next two years, the company announced as part of its Q4 2014 earnings release. Here’s how Netflix CEO Reed Hastings and CFO David Wells put it in a letter to investors Tuesday:
“Our international expansion strategy over the last few years has been to expand as fast as we can while staying profitable on a global basis. Progress has been so strong that we now believe we can complete our global expansion over the next two years, while staying profitable, which is earlier than we expected. We then intend to generate material global profits from 2017 onwards.”
These bold statements comes after the company once again showed significant international growth. In Q4, it added a total of 2.43 million subscribers abroad, and now has a total of 18.28 million members in its 50 international markets. Domestically, it ended 2014 with 39.11 million subscribers, compared to 33.42 million a year before that. Netflix ended the year with a total of 57.39 million subscribers, compared to 44.35 million at the end of 2013.
So how did Netflix do money-wise? Not so shabby either: The company booked $1.305 billion in revenue from its streaming operations in Q4 of 2014, compared to $962 million during Q4 of 2013. It was able to generate a surprising $83 million of net income in Q4, compared to $48 million during the same quarter a year ago. However, that growth is in part due to tax benefits of $39 million.
But back to Netflix’s bold international plans. Hastings and Wells made it clear that they’re not just talking about adding a few more countries and then calling the job done:
“We already offer Netflix in about 50 countries and have learned a great deal about the content people prefer, the marketing they respond to and how to best organize ourselves for steady improvement. Acceleration to 200 countries is largely made possible by the tremendous growth of the Internet in general, including on phones, tablets and smart TVs.”
Hastings and Wells even laid out plans to enter China through a smaller, targeted service “centered on our original and other globally-licensed content.” The remarks about China include a caveat about acquiring “the necessary permissions,” which is particularly challenging for a service like Netflix that relies so heavily on smart TV apps. China’s regulators have in the past months cracked down on streaming devices and smart TV services, which they consider similar to running a broadcast station in the heavily regulated country.
The letter to investors names revenue growth as one goal of an accelerated international expansion, with a goal of getting to $10 billion in yearly revenue soon. Based on the Q4 earnings release, Netflix ended 2014 with around $5.5 billion in revenue from streaming and its domestic DVD business combined. But the letter to shareholder also paints Netflix as a global licensor for content, able to compete with some of the biggest media companies in the world:
“With the growth of the Internet over the next 20 years, there will be some amazing entertainment services available globally. We intend to be one of the leaders.”
Here are some other key metrics disclosed as part of the earnings release:
- Netflix plans to spend $3 billion on original content in 2015.
- The company wants to spend $600 million on marketing this year.
- Netflix plans to spend $500 million on technology in 2015.
- Netflix grew to five million subscribers across Latin America during Q4 of 2014.
- The streaming service intends to release a total of 320 hours of original TV shows, documentaries, comedy specials and movies in 2015, which is three times as much as the company put out in 2014.
This post was updated at 2:30pm with additional metrics on Netflix’s spending and original content plans.
Hulu, meet your Latino cousin: Spanish-language digital entertainment company Latin Everywhere launched a new online video service dubbed Pongalo Tuesday that aims to target Spanish-speaking audiences in the United States with free telenovelas from Venezuela. One especially notable title: Juana la Virgen, the show that the CW hit Jane the Virgin is based on.
Pongalo is launching with 10,000 telenovelas episodes, which are available for free on the web as well as through the service’s iOS and Android apps. Much of the content stems from RCTV, Venezuela’s largest TV network, which happens to be owned by the family of Latin Everywhere CEO Jorge Granier. Shows will be Spanish-language-only at launch, but Pongalo wants to add English subtitles over time.
Pongalo wants to eventually also launch a paid service, but Latin Everywhere Chairmain Rich Hull told me Monday that it was important for the company to first have a free, ad-supported tier in place. “There (is) an extraordinary amount of advertising dollars flooding into the Hispanic digital media space right now, and brands are desperate for ways to connect with Hispanic consumers in the digital world,” he said via email.
Pongalo isn’t the only company aiming for Spanish-language consumers. The growing Latino market is also being targeted by big domestic players like DirecTV, which recently launched a Spanish-language streaming service called Yaveo, and Hulu, which has struck deals with Univision and others to carry telenovelas.
As part of Hulu’s partnership with Univision, it is carrying abbreviated versions of telenovelas that allow viewers to watch an entire season in just 12 episodes, as opposed to the dozens or even hundreds of episodes that make up the typical season of a telenovela. Pongalo’s Hull objected to this approach when I quizzed him about it:
“Shorter, edited versions of telenovelas is not something we’ll be doing. TV creators create their shows in a particular way and we don’t want to mess with their genius. If something is going to be shorter, then it should be created that way from the beginning. We think you have to respect digital audiences in a way that plays by the rules of the medium and doesn’t just see digital as a place where you can cut down a TV episode, movie or commercial and have it feel organic. Digital audiences know the difference. “
He added that the number of episodes won’t stop viewers from tuning in:
“People who watch novelas are extremely passionate about them. So, if they’re going to watch 5 episodes of a novela, they’re going to watch all 150.”
Netflix is becoming more and more like HBO: Customers of U.K. telco BT can now pay for the service with their monthly TV bill.
Netflix has hired marketing agencies to prepare a launch down under, which is likely going to happen some time next year.
A year and a half after its official launch, Redbox Instant is calling it quits. The shutdown shows how hard it is to compete with Netflix for streaming video subscriptions.
Netflix will launch in Germany and five other European countries this September, and local broadcasters are scrambling to compete.
Netflix is getting ready to strike a partnership in Germany — but in neighboring Austria, it could soon get a new competitor.
Apart of what it would do for Microsoft’s Xbox games business, the purported new hardware-and-services bundle, if successful, could hold significant implications for its broader digital living room ambitions as well. If Microsoft proves it can attach long-term service commitments to Xbox hardware, it’s no big leap to imagine it eventually leveraging those contracts to begin reselling other services and subscriptions.