Netflix in Helvetia: The on-Demand Internet Streaming Media Launched in Swiss Confederation
The competition among video
applications/market for content such as Netflix, Amazon, Hulu,
YouTube, and traditional television is violent. The future of distribution in
the entertainment industry is almost entirely digital; competitors are fighting to get most of the market shares. While online piracy has escalated as
well, video streaming activity coming from legitimate online streaming services, such as
Netflix, are a good reason for TV shows/movies fans to finally (and definitely) ban pirate sites. In just one week, the American
provider of on-demand Internet streaming media has just expanded its European
market with 5 new countries: France, Germany, Belgium, Italy, Spain, and Switzerland.
The reason is simple. As noted by Netflix CEO Reed Hastings
and CFO David Wells: “This launch into markets with over 60 million broadband
households will significantly increase our European presence and raise our
current international addressable market to over 180 million broadband
households, or 2x the number of current U.S. broadband households”[1].
Netflix is not just a new startup founded by two guys in a
garage. The company was already founded in 1997, in California, by Marc
Randolph and Reed Hastings[2], and introduced the monthly subscription concept in September 1999 in the
United States. Today, the company finished the second quarter with 50 million
subscribers (for
instance, Hulu has 6 million and Amazon 20 million). Other impressive numbers, Netflix “reported $1.34 billion in
second quarter revenue, up 36.9% from the same period last year with
international streaming contributing $307 million, more than double
international revenue a year ago. Overall net income came in at $71 million, up
from just $29 million a year ago (…)”[3].
Simply put, this California based video streaming powerhouse
offers affordable way to get high quality on-demand movies and TV shows into
your living room. It’s a huge catalogue of content from which you can watch (almost)
anything, in one reasonable monthly subscription. If that’s the solution
against online piracy, that’s another question. The model is definitely not
perfect, but at least, it exists and offers the possibility to “go for legal”
instead of turning to torrents and piracy.
Let’s take a closer look at the “reasonable monthly
subscription” around the world to see if Switzerland is really benefiting from
the launching of Netflix:
Country
|
Month
streaming plan (1 SD screen)
|
US
|
$8.99 ( 7 EUR)
|
UK
|
£6.99 (8,85 EUR)
|
Norway
|
89 kr (9,65 EUR)
|
Switzerland
|
11.90 CHF (9.83 EUR)
|
Germany
|
7.99 EUR
|
Canada
|
$8.99 ( 7 EUR)
|
Denmark
|
89 kr (9,65 EUR)
|
Ireland
|
7.99 EUR
|
Finland
|
7.99 EUR
|
The Netherlands
|
7.99 EUR
|
France
|
7.99 EUR
|
Belgium
|
7.99 EUR (tbc)
|
Luxembourg
|
7.99 EUR (tbc)
|
Mexico
|
$8.99 ( 7 EUR)
|
Sweden
|
89 kr (9,65 EUR)
|
As you can see from the table, the highest price for one
non-HD screen (SD) is in Switzerland. While the average for the up to 4 screens streaming simultaneously service (“ultra
HD”) is 11.99 EUR in Europe, Switzerland hits the top again with a 17.90
CHF (14.82 EUR) monthly subscription. Comparing to a cinema ticket price in
Switzerland of 15.57 CHF in average[4]
(in Geneva, for instance, don’t except to pay less than 25 CHF), it’s
still pretty affordable. It’s not the
first time that this country is experiencing this situation. For example, the
Spotify subscription is 43% more expensive than the US. Rich country, higher
prices. Makes sense, right? Or not. One may ask: Why not a Netflix global price without
any geographical restrictions? That’s a good question. If it’s
implemented too fast around the world, it may deprived local services distributors
and other right holders of licensing fees (see below with France). For instance,
in Australia, up to 200,000 people are estimated to use the U.S. version of Netflix[5]
(with an unblock-US account i.e. a cheap VPN subscription). Recently, some major players (read Warner
Bros, Universal, Sony Pictures, etc.) are actively lobbying for a global ban on
VPN users.
In Switzerland, what’s already noticeable after the launch
of the video streaming service last night (on Wednesday September 17, 2014), is
that the TV Show “House of Cards” is not available. Another bad news, it is impossible
to have any insight into the catalog without registering. In France, for
instance, the most recent movies have at least 36 months. And Canal+ has
obtained the rights for “House of Cards” at least until the third season. So
forget about it too.
Don’t get me wrong. Netflix has still a lot to offer. A lot
of devices are compatible with it (Apple TV, PS3-PS4, Xbox, Samsung, Android,
etc.), it’s very convenient (instant, easy subscription, good quality
streaming), and you get a personalized experience based on your previously
rated movies, or movies that Netflix thinks you will like. It cannot be found
elsewhere! As I truly believe Spotify has changed the way we consume music,
Netflix has the potential to do the same, at least in Europe, with the distribution in the
entertainment industry.
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