25 pay-TV providers so far have active partnerships in place with Netflix and more will follow with global expansion to 130 new markets.
Speaking at a seminar organised by IHS in London, Ted Hall, the company’s research director, TV, said that although strategic goals vary, they serve a few purposes. These include helping subscriber acquisition by enhancing their entertainment offering, including 4k; boosting the appeal of high-speed broadband required for streaming video; and boosting customer satisfaction/loyalty and reducing churn.
However, Hall also pointed out that Netflix is not necessarily appropriate for all types of operator. For instance, ones such as Sky and UPC (My Prime) can compete with the service by offering branded pay-TV SVOD.
On the other hand, he also said that the early assessment of partnership dynamics points to Netflix fulfilling pay-TV subscribers’ strategic goals.
Even so, there are risks of such partnerships, including a reduction in TVOD consumption, as well as a reduction in operator-branded SVOD usage.
They could also lead to a diminishing interest in premium movie channels offered by operators.
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