With the likes of major household brands like Virgin Media ramping up their movie VOD offerings, Netflix is going to have its work cut out to retain a foothold in the UK market.
Virgin Media is overhauling its on-demand movie service, making latest blockbusters available to non-subscribers on a download-to-rent basis for the first time.
It will now offer over 500 of the latest releases, including Avengers Assemble and The Hunger Games, from £1.99 for 48 hours, available from 17 September.
It’s a move which will put it on a more even kilter with Sky’s new Now TV service, aimed at netting the 13m non-pay TV subscriber UK homes. But it is also a move which begs the question of whether US movie and TV streaming service Netflix is doing enough in the UK to really make an impact in an already saturated VOD market, which is even seeing the major supermarket chains take significant steps in the digital movie rental space.
Netflix launched with great fanfare in the UK earlier this year, touting its service as one which boasts an “unlimited” array of film and TV content. Of course this couldn’t ever have been true, as Sky has always dominated the new-release subscription rights window, and Netflix is a subscriber service. If it had been pay-per-view it would have had a much better chance at providing an “unlimited” array of content, but then it would have also only had access to the same pay-per-view rights window made available to all – so would be competing with Tesco, Sainsbury’s, HMV, Dixons, as well as Sky and Film4 on-demand.
At the time of its launch in January analysts already predicted it faced an uphill challenge with regard to gaining premium rights content (nma.co.uk 9 January 2012).
Since then it claims it has hit 1m subscribers in the UK, which is a decent number, although it would be interesting to know how many of those have stayed on beyond the free trial stage to become paying customers. It is cheap yes, but it is not better than the content offered on Lovefilm, and with the latter’s brand and service more firmly established in the UK is there really a need for such a similar service?
Vindicia CEO Gene Hoffman has previously alluded to the importance of Netflix ensuring it retains its UK customers before pushing expansion into other territories (nma.co.uk 30 August 2012).
Netflix’s great unique asset is its original content arm, which it is developing in the US. But this is yet to really materialise in the UK. It certainly has made no secret of its ambitions to expand further into other territories, but regardless of its intentions, it will need more than an archive movie content service if it is to rival the established services of its competitiors in the UK.