ad hoc study
Netflix’s success in the US market has sown fear among the legacy pay TV players worldwide and quickly turned into hype. This fear is not entirely unfounded as Netflix and other SVoD services have been creating such havoc in the US markets, accelerating the decline in satellite and CaTV customer bases. In retrospect, Netflix’s hype so far outweighs any real threat in Western Europe but the mere presence of the service together with improving broadband speeds (both fixed and mobile) would continue to shape the local pay TV markets. Specific cultural/market preferences, e.g. Germans prefer dubbed contents rather than subtitled ones or diverse/highly segmented community in Belgium, are one of the key aspects affecting the Netflix's adoption. As of the moment, Netflix's content portfolio is still lacking localised content and largely US-based (i.e. mostly American series and Hollywood films), thus contributing to its still relatively sluggish adoption. This content gap is where telecom players can come in and leverage their local market expertise in order to create differentiation from Netflix or other international SVoD providers (e.g. Amazon or Hulu).
InfoCom estimates that Netflix subscriptions in Western Europe has reached 11.3m as of 2Q15 with 39% coming from the UK and Ireland, 33% from the Nordic region (Denmark, Finland, Norway and Sweden), 18% from the French- and German-speaking markets (Austria, Belgium, France, Germany, Luxembourg and Switzerland) and 10% from the Netherlands.