Analysts see Cuba as definitive cord-nevers market

DetailsJuan Fernandez Gonzalez | 13 February 2015

Netflix's move to enter the Cuban market earlier this week surprised many in the industry, as the country is far from having ideal conditions for the rapid growth of a subscription video-on-demand (SVOD) online platform. Now, an analyst note points to a possible long-term strategy in a market in which traditional pay-TV might never arrive.

From 9 February, Netflix has been available for Cubans who have access to the Internet and can pay with an international credit card. But what initially seemed to be just another expansion through Latin America has been delved into deeper by some analysts.

A note published by the Argentinean firm Carrier y Asociados states that over 25% of Cubans have access to the Internet, but only 5,000 connections are broadband and most of these are not in private homes. In addition, one hour's connection to the Internet costs $4.50 and a Netflix subscription is $7.99, this on an island where the average salary is $20 per month and international credit cards are rare.

So, "where's the beef?" asks the firm. For Carrier y Asociados, Netflix is preparing for coming developments on the island and a highly possible technological leapfrog which is to jump over the cable TV industry and develop pay-TV directly through the Internet. According to the researchers, Cuba will never be a market of cord-cutters because it will immediately become a cord-nevers market.