In a shocking spectacle of insider dealing, the Chairman of Baidu, along with others announced plans in February 2016 to buyout iQiyi from Baidu for $2.3B.
China’s online video market is massive: there are 660 million internet users, and 75% of those consume video content online. However, the SVOD model is new.
Will the US studios finally cut off Netflix from licensing their content now that it is subsidizing Netflix’s greater expansion into original content?
Starz dips its toe into the streaming market with an investment in website Fandor for $7 million. Fandor streams classics, shorts, docs, and esoteric material.
CBS All Access will stream the Star Trek reboot series. There is no word if the series will eventually be licensed to Netflix and other VOD subscribers.
Netflix was prepared to launch in Japan unchallenged, until Amazon announced it would rival Netflix by making content available for Prime customers.
YouTube’s first foray into content subscription services may have challenges from license holders. Disney’s unit ESPN, has withdrawn content from YouTube.
BOTTOM LINE ~> Global OTT video subscription revenues will increase from nearly $9B in 2014 to over $19B in 2019. Currently, 57% of U.S. broadband households subscribe to an OTT video service. Among European broadband households, 57% in the U.K., 29% in Spain, and 24% in Germany subscribe to an OTT service.
BOTTOM LINE ~> As Netflix approaches saturation levels in the United States, international growth will be crucial to mid- to long-term success. Absence of popular titles led to a dismal first year in France. Current estimates for French subscribers are around 750,000. In the same amount of time, Netflix was able to gain more than double the amount of subscribers in the United Kingdom after launching.
BOTTOM LINE ~> Over 100 million people visit Alibaba sites every day. Their decision to enter the set-top box market is a clear opportunity for content owners and aggregators in North America and Europe to grab a slice of the pie in China.