The World’s leading internet television company, Netflix has announced that it is expanding to about 130 companies around the world including Nigeria. According to the Press Release issued by the company, subscribers to Netflix service will be able to stream their series and catalogue of licensed TV shows and movies.
Netflix is also available on virtually any device that has an Internet connection, including personal computers, tablets, smartphones, Smart TVs and game consoles, and is known to provide one of the best possible streaming quality based on available bandwidth.
Implication for Nigeria Market.
Highs....
Before now watching Netflix from Nigeria was virtually impossible as you get blocked once your IP address is recognized as coming from Nigeria. By including Nigeria, interested subscribers can now access Neflix in exchange for a fee giving them access to their bouquet of movies, series and TV shows. Internet service providers in Nigeria will be happy to hear this announcements as it means Nigerians will have to rely on their service to stream programs. Internet consumption in Nigeria has been on an increase in recent years and now forms a huge chunk of the revenues accruing to GSM companies. Nigerians are now used to browsing the internet with their mobile phones, tablets and laptops relying on mifi’s, internet modems and VSAT. According to the National Communications Commission, NCC, Internet subscription numbers for GSM companies was about 97 million and almost thrice the number in 2012.
Lows......
The news might not be so good for Nigerian companies into internet movie, series and TV show streaming. Netflix has a huge economies of scale that they can’t compete with and have also started adding Nigerian movies in their bouquet. They are also very good in the business of internet television and have what it takes to embark on a price war with their Nigerian competitors. Digital satellite TV stations are also threatened by this news as Netflix also boast of an impressive catalogue of series, TV shows and Box Office movies.
The Nigerian government could also lose tax revenues and face another round of forex pressures on its external reserves if the subscription is priced in US dollars. If the Nigerian Government is not up to speed with its plans to widen its tax base it could lose potential revenues to the US.
The post above and its ensuing comments, if any, is purely the opinion of the writer(s). It therefore should never be considered as an investment advise of any sort. If required, readers should please consult a competent professional financial adviser for any investment decision.
Netflix coming to Nigeria will challenge iRoko TV to a standstill. It’s too early to say Netflix will take over the market, since iRoko TV already has a fairly large market-share. Though, they are other factors to consider, including the robust contents that are available on Netflix which iRoko TV can’t compete with at this time. Also, Iroko has some unique local contents Netflix does not have access to.
Yet, what iROKO has been able to do, which will constitute a challenge for Netflix. How the U.S. company can compete and thrive in spite of the internet troubles in Nigeria. Data plans are expensive and internet connection isn’t the fastest around here. Those may be the main challenges in Nigeria.
But it is possible that Netflix will offer free browsing on its plan. This is what we think will be the game changer in Nigeria. If that happens, it will take over the market. It has the financial muscle to provide free browsing and streaming on MTN, Glo, Airtel and Etisalat.
Lets' see how it goes.We are watching.
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