Bottom line: The delay in Netflix’s plans to enter China this year may be due to lobbying from domestic online video companies, and it could be several more years before it gets permission to form a China venture.
China absent in major Netflix expansion
Shareholders of US entertainment giant Netflix (Nasdaq: NFLX) will be disappointed to learn that China wasn’t included on the company’s global road map, as it announced a major expansion for its signature online video service. Many believed that an entry to China could come as early as this year, after media reported last spring that Netflix was in talks to set up a Chinese online video joint venture with Wasu Media (Shenzhen: 000156), which is backed by e-commerce giant Alibaba (NYSE: BABA).
But the road into China was never going to be easy for any foreign online video company, due to Beijing’s heavy censorship of the Internet and also its inherent bias against big foreign companies. All that said, Netflix isn’t exactly writing off China completely either, but is simply saying its road into the market may take longer than it previously hoped. Read Full Post…
Bottom line: Alibaba’s new Disney tie-up is unlikely to gain much traction due to overcrowding in China’s Internet video market, while its tie-up to sell $8 billion worth of bad debt from asset manager Huarong looks mildly positive.
Alibaba in streaming tie-up with Disney
E-commerce giant Alibaba(NYSE: BABA) is in a trio of headlines as we head into the year-end holidays, led by a new tie-up with Disney (NYSE: DIS) as it looks to leverage its growing stable of media assets. But in a sign of how much attention the company now attracts, the other 2 stories in the headlines aren’t really ones that Alibaba would care to trumpet too much.
The larger of those is mildly positive, with media reporting that Alibaba’s Taobao C2C marketplace is teaming up with one of China’s leading bad asset sellers to auction off $8 billion in soured loans. The other headline is one that’s becoming a small headache for Jack Ma, and involves Evergrande Taobao the soccer team that he co-owns. That story has one of Japanese car maker Nissan’s (Tokyo: 7201) China joint ventures suing the club for breach of contract related to a high-profile sponsorship dispute. Read Full Post…
Bottom line: Netflix may be in talks to enter China through a joint venture, but is unlikely to reach a deal for at least the next 1-2 years due to regulatory turbulence and tough restrictions in the rapidly changing market.
Netflix eyes China
Investors are getting excited about reports that leading US video streaming site Netflix (Nasdaq: NFLX) is in talks to come to China, in what would be the first such move by a major foreign video operator. The prospect of such a move would indeed be exciting, especially since it could come in partnership with a company closely tied to Chinese e-commerce leader Alibaba (NYSE: BABA). But I would caution that this particular market is a very tricky one due to China’s strict censorship policies, and also recent resistance to private companies from traditional state-owned TV stations. Read Full Post…
The following press releases and media reports about Chinese companies were carried on March 8-10. To view a full article or story, click on the link next to the headline.
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