Competition heats up for Netflix

Netflix has shaken up the whole content world – from production with its programme of huge-budgeted originals, distribution with its big cheques for exclusive rights, and transmission with low-cost month-long subscriptions. The same could be said, albeit to a lesser extent, of Amazon with its Prime Instant Video service.

Having disrupted the whole TV business, Netflix and Amazon have also validated their SVOD business model. Some of the companies most threatened by the US-based firms – and others simply mindful of the opportunity they have proved exists – are now taking the fight to Netflix.

In Canada, rival cablers Shaw and Rogers are launching Shomi, a new subscription video-on-demand service that will roll out in November. Announcing the new service the cablers said that Shomi will use “algorithmic technology to help you pick what you actually want to watch”. The investment in content is clear, with Shaw and Rogers having secured SVOD rights to 340 series and 11,000 hours of TV shows and 1,200 feature films. They added that 30% of that content will be Canadian.

A raft of US drama series will be available at launch including The Strain, Modern Family, Sons of Anarchy, 24: Live Another Day and Sleepy Hollow from Fox, MGM-distributed Vikings and NBCU-distributed Chicago Fire. Priced at the same C$8.99 (US$8.29) point as a new Netflix subscription in Canada, the cablers are clearly fighting back and keen to lure their existing customers and offer cord cutters and others a new alternative.

In Australia, Nine Network’s parent company is partnering with publishing group Fairfax Media to create a A$100 million (US$93.3 million) Australian subscription video-on-demand service. Mike Sneesby already in charge of the venture, StreamCo. and both Nine and Fairfax will invest up to A$50 million in to the business. It will roll out in 2015 with a “a broad range of local and international programming”. Netflix is also expected to launch in Australia in 2015 with about 200,000 Australians thought to be accessing the US service via a VPN.

StreamCo. will compete with existing SVOD services such as Quickflix and Foxtel’s Presto, but says it has secured “a number of cornerstone content deals ahead of its launch”, without giving further detail.

In Belgium, BeTV, the pay TV operator formerly known as Canal+ Belgium and owned by cable operator Voo, has launched a streaming service ahead of Netflix’s launch in the European country. Although a TV Everywhere, rather than SVOD, service, it will provide Belgian pay TV customers with another streaming option. It is available to subscribers at no extra price. BeTV Go will include channels Be1, BeSéries, BeCiné and BeSport along with the service’s on-demand offerings.

BeTV has access to premium Hollywood content via deals with the major studios, with rights to movies ahead of their free-to-air showing. Forthcoming US series to be aired on BeSéries include season three of Netflix’s own House of Cards and season five of HBO’s Game of Thrones.

Netflix has not reached Africa yet, but Netflix-style services are rolling out in the continent. Aflix, a premium OTT service featuring more than 2,000 hours of content, including new releases from major Hollywood studios, went live in late August. The new service is available now on smartphones and tablets in Sub-Sahara Africa and was launched by connected platform provider Vonetize, and billing solution provider SmartPay.tv. It offers Hollywood and Bollywood movies, TV series, kids content, telenovelas and sports, lifestyle, nature, science and music programming.

It will complete against rivals African content services such as Pana TV.

Programming deals are in place with Disney, Warner Brothers, MGM, Lionsgate and Miramax and Aflix has popular shows including Mad Men and Anger Management. Vonetize plans to expand across Africa during 2015, making the service available on LG, Toshiba and Samsung smart TVs, as well as set-top-boxes.

Netflix, meanwhile, is continuing its expansion, announcing its first-ever original drama in France, ahead of its launch in the country. Marseille will be an eight-part drama of “power, corruption and redemption” for the internet TV service, set in the French port town of the same name. It will focus on a long-serving city major, who faces a young and ambitious rival in upcoming elections in which he has already chosen his heir. The pair will stage a merciless fight that brings in drug lords, politicians, unions and other political players from the city.

International subscriptions will account for one fifth of Netflix’s overall business in four years time as it completes its planned raft of launches in European countries, according to a recent study by IHS Technology. IHS estimates that Netflix’s launch in Belgium, France, Luxembourg, Austria, Switzerland and Germany later this year will add five to six million new subscribers to its customer base.