Video streaming has long been an enticing sector in China attractive to all types of players. Local behemoths poured loads of cash to entrench their video effort, a big chunk of which went straight to American TV producers. For example, Netflix’s fabled House of Cards was bought by Sohu TV, the streaming arm of Sohu.com, among many TV series on Chinese video sites also hailing from the States.
It now seems that Netflix is looking to take its relationship with the sector a step closer. According to Reuters, Netflix’s Chief Content Officer Ted Sarandos briefed a group of reporters this week in Shanghai that the company isn’t just looking at importing content to China, it also works the other way around: the company also plans on introducing content from China to the rest of the world.
Netflix’s approach to the lucrative China market, however, sounds a little different from its peers who usually seek after a local partner and set a JV in motion in a way to obtain licenses required to do business. For instance, Ted said that Netflix might need to obtain eight different licenses to get its business up and running in the Chinese mainland. Yet, with a full awarenes of the situation, the company might still want to steer its China strategy without a local partner.
The U.S streaming service’s boldness might be buoyed by a recent finding that 21.6 million out of the 30+ million monthly users who access Netflix from countries where it isn’t officially available are from China. This may be similar to Google’s time in China. The search engine company was widely used by Chinese long before it set up an office here, while its attempts to stay in line with domestic regulations compelled it to withdraw.
Licensing issues aside, competition from local rivals with ample cash reserve will be considerable. As a new market entrant with low brand name recognition, the company will have some heavy lifting to do to catch up with the local competitors such as Alibaba, Youku and iQiyi.
Editing by Mike Cormack (@bucketoftongues)