Netflix is coming to Singapore

Happy Deepavali to our Hindu readers.

This is not really new news, but Netflix is launching in Singapore in early next year. This may give existing cable TV operators a run for their money, which is going to be the main part of my post today.
Netflix charges different prices for a few different plans in the US currently (they plan on charging similar rates after the exchange rate differences), ranging from US$7.99 to US$11.99, with the top end of the range being slightly higher than the cost of renting the top-tier setup box from Starhub. I think that it is much cheaper to watch Netflix and they have some exclusive content that the two cable operators do not have, but just to be fair, Netflix content may be lacking in some content as well (such as Asian content for those who watch K drama or Cantonese shows).

Other than being cheaper, Netflix can also be watched on the go with their App Store and Google Play apps, which would give them an edge over the cable operators. So I think that Netflix poses a credible challenge to the existing cable operators, which may have to restructure their current offerings or slash their prices to keep up with this new competition and maintain their cable TV business.

This business is also quite important to the telcos. The pay TV business generates $390 million of revenue for Starhub (AR 2014) and $302 million for Singtel (AR 2015). For Starhub, this is especially important as it makes up 16% of her total revenue and so for people thinking of investing or are already vested in it, this is an important part to consider. There are talks of a partnership between Starhub and Netflix, but it may turn out to be more of a compromise and Starthub's position may still turn out worse than it is currently.

Along with the possibility of a fourth telco entering the local market, Starhub seems to be facing pressures from all sides. While Singtel also faces similar problems, but it is much larger and most of its business comes from outside Singapore (refer to pic below).

(Image source; Singtel AR 2015)

On a side note, how many of you are considering subscribing to Netflix when it does come to Singapore?

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