Netflix shares soar on rumours of Chinese launch

DetailsJoseph O'Halloran | 17 May 2015

News that the Netflix juggernaut is about to roll into China has led to a spike in the SVOD leader's share price.

NetflixOrangeAccording to reports in the Wall Street Journal, Netflix has been in talks with a Chinese media company backed by Jack Ma and other possible partners as it seeks entry into what could be near $6 billion online video market. It added that Netflix has held discussions with companies including Wasu Media Holding Co, not confirmed by any of the parties concerned.

Analysts believe that partnerships will be essential for Netflix to have any chance in a market characterised by strict controls on content.

"China is too big to have an asterisk next to it," the WSJ quoted Netflix chief content officer Ted Sarandos as saying at the Cannes Film Festival. "There are a lot of operating constraints in China that are different to anywhere else. We don't have any operating partners anywhere else in the world, so that would be a new skill for us too...We are also aware that there are unique operating models we've not worked in before, we've not acquired companies, we've not worked with partners before in any of our territories. If that's the cost of doing business in China we will figure that out."