Today Netflix launches in the Netherlands


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This morning Netflix opened their doors to the millions of Dutch households. For 8 euros a month Dutch users can watch an unlimited amount of movies and series. But why would we subscribe to yet another service, while downloading movies is still legal and never has been easier. Why would they select the Netherlands over other European countries and is this decision correct?

If you really think about it the Netherlands seems like a logical choice. There are roughly 7.5milion households and 90% have broadband.  The download speed is globally ranked as 7th and in Europe 2nd behind Luxembourg.  The population speaks and understands English very well and the movies aren’t dubbed as in Germany or  French.

But on the other hand, we are known as greedy and there is a lot of competition out there. Several services already offer movies at home, for example Pathé thuis (launched by the cinema Pathé) and Video on Demand by companies as Ziggo, UPC and KPN.
Are consumers willing to pay the price? Basic television subscriptions cost between 15 and 30 euros a month. Dutch TV shows as “Boer zoekt Vrouw” and “The voice of Holland” get ratings of 4,3 and 3,7 million viewers , which is 25% of the Dutch population. Do these viewers really want to pay an additional fee, for movies which can also be downloaded in the same quality? Netflix can’t yet show the newest movies and series which just came out of the cinema, so their content will be a bit outdated.

Spotify was able to enter a similar market, the music industry, and got over 1 million users in the Netherlands, and these users turn out to be the most active users within West-Europe. Will Netflix be able to create a similar buzz which will convince consumers to try it out? Netflix sure makes things easy, your account is up and running within a couple of minutes and you can watch content on your smart-tv, computer, laptop, gaming console and smartphones. But their competitive advantage isn’t only ease of use. After a couple of movies or series Netflix will suggest what else you should watch, based on their database and other peoples preferences.

Not only will it be interesting to watch Netflix’ launch in the Netherlands from a business perspective, but also from a cultural and IT perspective. Will they be able to change the competition or will they simply pass along, unnoticed.

[1] http://gigaom.com/2013/09/10/netflix-netherlands-launch/

[2] http://www.theverge.com/2013/7/31/4575506/spotify-doubled-revenue-in-2012-but-losses-grow

[3] http://www.netindex.com/download/allcountries/

[4] http://www.kijkonderzoek.nl/component/Itemid,45/option,com_kijkcijfers/file,n1-0-1-p

[5] http://www.onemorething.nl/2013/05/nederlanders-zijn-spotify-grootgebruikers/

[6] http://www.nu.nl/internet/3367011/spotify-werft-1-miljoen-nieuwe-betalende-abonnees-in-3-maanden.html

[7] http://tech.co/what-your-startup-can-learn-from-spotifys-success-2013-04

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7 responses to “Today Netflix launches in the Netherlands”

  1. tomhutten says :

    I think Netflix has a real chance of succeeding in the Netherlands mainly because of aforementioned reasons. As indeed Spotify has shown to work on the Dutch market and our infrastructure has been ready for such a long time.

    We were just waiting for a real gamechanger and Netflix is just that.
    I believe that the amount of (American) content that Netflix offers is unmatched by the small competitors of today especially for the monthly price it goes for.
    Cabel companies such as Ziggo and UPC rely too much on a pay per view basis and Pathe works the same way as Netflix but is much smaller and probably even more unknown than Netflix is.

    Lastly I have been downloading content for a long time though Spotify made me pay for music and Netflix will let me probably pay for Tv-series and Movies.

    • anttifromrotterdam says :

      I agree with Tom that Netflix has a good chance of succeeding in the Netherlands, even though I don’t know the local market so well. Netflix launched in Finland on the 18th October of last year, and the same skepticism was in the air. However, in addition to the benefits mentioned by the original author of this post and Tom, it offers a value proposition that is very appealing, at least from my point of view: For 8 euros a month, you have a lot of content to choose from, legally and easily. This means no more downloading! It just makes users feel better about themselves, for a small price.

      To address the concern of limited programming, the problem was addressed very quickly in Finland, as this started spreading on Social Media: http://vpnfreedom.com/netflix/how-to-watch-the-american-version-of-netflix-in-finland/ Few step-instructions on how to use proxy technology to enable the American version of Netflix (and all of its content) on your devices in Finland!

  2. woutero90 says :

    I think Netflix could be perfect for the Netherlands. The Netherlands is full of people that download movies and series (or just stream them) online and they have good reasons for that (time, annoying commercials, money, etc.).
    Now Netflix offers the oppurtunity to watch series and movies whenever you want and for a price, in my opinion, even Dutch people find reasonable.

    The only thing that I am not sure of is whether the content will do for the Dutch audience. The movies that they offer are old and probably not interesting for a big part of the audience, while the well known series not even broadcast their newest seasons. Netflix should hope that there self produced series will be appreciated by the Dutch audience, because that is the only content offered by Netflix, that is actually new.

  3. 373132rk says :

    Netflix has said it wants a third of the Dutch market in 5-10 years, like it has in the US at the moment. Quite a task they’ve set upon themselves.

    A serious problem might be supplying the content people want, as the current library doesn’t appear to be fantastic. While I have no doubts that Netflix as a company has the capability to deliver just that, I’m wondering if they’ll actually want to invest the efforts. Let me explain: The problem with supplying content in any country is that you have to deal with all the different content providers and copyright holders, which takes a lot of effort, time and money.

    The dutch market currently has around 6.5 digital TV customers, so Netflix is aiming for about 2 million customers in the Netherlands. In April of this year, Netflix had almost 37 million subscribers in the US alone. This means that the ratio between the potential amount of extra customers and the amount of time invested in getting the right content, is usually much lower than in bigger countries.

    While I hope Netflix can overcome this problem and I’m sure they’ve calculated the hell out of it, I can imagine it being an obstacle for the serious growth they’re looking for.

  4. ricardovangijzen says :

    Netflix brings with it’s current assortment a small addition to the Dutch TV market. However it will be a matter of time before Netflix will add more TV-shows and movies. But if Netflix has not realized the capturing of the market as forecasted, it could try to combine it’s service with the current TV-providers such as UPC and KPN. Virgin Media announced this strategy last week for the users in Great Britain, which I think is an excellent strategy to expand your customer base.

    http://www.economist.com/news/business/21586325-time-being-netflix-trying-be-ally-pay-television-making-friends

  5. ShiHaoZijdemans says :

    I am fairly confident that Netflix will make a successful entrance into the Dutch digital television market.

    An interesting statement published today from Netflix Vice President of Content Acquisition was that they use Pirate/torrent sites in determining what TV-series to buy. This statements communicates to the public that they accept the existence of piracy, and that they are looking to convert as many users from pirate-sites to Netflix.

    Yes, Ward, Dutch people are known for ‘being greedy’ as you said very nicely, but I think this factor will not delimit potential success for Netflix. I agree with Antti on this point; Dutch people are still (wealthy) human beings, who will enjoy the satisfying feeling of ‘giving back to the community’, and ‘doing the honest thing’. Doesn’t it make you enjoy your favourite tv shows even more knowing you acquired that show in an honest way?

    Also, I was a bit shocked because of the price of just €8 for unlimited entertainment. It would save me the time of connecting my pc to my tv all the whenever I want to watch Dexter or Breaking Bad from my relaxing-couch. Unfortunately the article states that Netflix was not able to buy the rights for “Game of Thrones” from HBO, no matter what they offered.

    http://torrentfreak.com/netflix-uses-pirate-sites-to-determine-what-shows-to-buy-130914/

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