In a statement, Netflix said it will sell content in the region for streaming on televisions, tablets, smartphones, computers and Internet-connected game consoles. Netflix will disclose pricing later, and didn't say much it will invest nor how many subscribers it hopes to attract.
Fast-growing Netflix had been expected for some time to target the market as it seeks to accelerate international expansion from its home base in the United States. Netflix currently has more than 50 million subscribers worldwide.
While its pricing model for Australia and New Zealand remains unknown, Netflix's $8.99 per month fee in the U.S. market is equivalent to just over a third of what some future rivals in its new market charge.
Australia offers a lucrative opportunity. A broadband network now being built is expected to give 93 percent of the country's 23 million population high-speed Internet access, but existing home-entertainment content providers have relatively low penetration for now.
In September the country's biggest cable TV channel, Foxtel, 50 percent-owned each by News Corp and Australian telecom firm Telstra Ltd, halved its prices to AUD 25 ($21.68) a month amid reports it's struggling to lift its 30 percent market share and speculation about Netflix's impending arrival.
Newspaper publisher Fairfax Media Ltd and broadcaster Nine Entertainment Co Holdings Ltd also plan a AUD 100 million joint venture streaming service, widely seen as a way to enter the market before Netflix.
"The risk with Netflix is that it can replace existing home media sources like free-to-air or pay TV or things like that," said one cinema analyst, asked not to be named because he doesn't cover Foxtel.
The analyst said that because almost no Netflix content is new movie releases, its arrival will have less immediate impact on Australian cinema companies like Village Roadshow Ltd and Amalgamated Holdings Ltd. Cinema operator The Hoyts Group, considering a AUD 1 billion listing, is also less at risk.
© Thomson Reuters 2014
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