Netflix CEO Reed Hastings announced at a Las Vegas conference that Netflix is to expand its services into a further 130 additional countries. The announcement came as a welcome boost to Netflix stocks, as at market opening on Monday, the share price dropped more than 6% after analysts at Baird suggested that US subscriptions were showing weaker growth than expected. The news resulted in Monday’s drop in price being wiped with the shares closing at over 9% higher. Despite the launch into markets such as India and Russia, Netflix will remain unavailable in China. Commenting on the Chinese market, Mr Hastings said that the streaming service was not going to rush into the market and instead will take its time to develop relations with the Chinese government, in order to reach a potential 1bn customers.
The success of Netflix and its main on demand streaming rival Amazon, has caused an increasing number of Americans to ‘cut the cord’, meaning that they are foregoing traditional, more expensive cable bundles and instead subscribing to on demand services. However, whilst streaming services are finding success in more developed countries, with 74 million of Netflix’s subscribers located in the US and Europe, there are problems associated with reaching rural areas in less developed countries. The availability of streaming services is hampered by the lack of internet. There are also problems associated with offering services in North Korea and Syria as these areas are currently experiencing a US trade embargo.