Blockbuster Streaming Service to challenge Netflix
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    Nasdaq Active Stock in Focus; Netflix Review

    Nasdaq Active Stock in Focus; Netflix Review

    Netflix Inc.’s (NASDAQ: NFLX) launch of services in Brazil is part of the company’s plans to expand into 43 countries throughout Latin American and Caribbean soon. CEO Reed Hastings said what Netflix seeks to do is connect the world to provide the world’s content to the world’s citizens.

    The expansion into Latin America will be a very different challenge for Netflix. The biggest challenge for the company will be to establish its brand, which is not very well recognized outside U.S. and Canada. Also, slower Internet speeds, smaller percentage of homes with internet connections and widespread piracy of movies will make it difficult for Netflix to sell its services in Latin American countries.

    According to Wedbush Securities analyst, Micahel Pachter, the service won’t work in Ecuador or Costa Rica or even Mexico as it has in the U.S.

    In Brazil, Netflix’s service will cost around $9 per month. Also, new subscribers in Brazil will get the service for free in the first month.

    The push into Latin America comes as Netflix faces challenges in the U.S. The company last week raised its subscription fee by 60% and this is likely to result in 2 million to 3 million customers canceling their subscriptions.

    Last week the company’s contract renewal talks with Starz LLC also fell apart over pricing issue. The company’s existing contract with Starz expires in February 2012. Starz’s departure could result in a big void in Netflix’s video library.

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