Will Netflix convince Aussies to pay?

NetflixGlobal giant Netflix will arrive in Australia in less than three weeks, ushering in what is arguably the biggest change to the television viewing landscape in decades.

But before it can truly add Australia to its growing list of international conquests, it has one big hurdle to overcome, namely, to convince Australians to pay to watch content.

SBS CEO, Michael Ebeid, thinks Australia’s aversion to paying for content will likely slow the growth of the local online streaming industry.

“My feeling is that it (streaming) will take longer to take off in Australia than it did in the US,” he told the Broadcasting and Digital Media Summit in Sydney.

Online streaming is taking off globally, nowhere more so than the US, where Netflix has close to 40 million subscribers.

But Ebeid said US consumers were much more likely to have a cable TV subscription than their Australian counterparts and so were already predisposed to pay to watch TV.

Around 90 per cent of US homes have a cable subscription, compared to around 30 per cent for Australia.

Meanwhile, Australians have already become accustomed to getting hit TV shows like Game of Thrones and House of Cards, having become among the most prolific illegal downloaders in the world.

Existing media players have preempted Netflix’s long awaited March 24 arrival by bringing out their own online streaming services: Fairfax and Nine have partnered together on Stan, while Seven West Media has joined forces with Foxtel’s Presto service.

According to its owners, Stan is on track to have 100,000 customers signed up by mid March and Nine boss David Gyngell, for one, has high hopes for the service.

“If we get this thing right, I believe that in three years time there will be a couple of million people subscribing to these sort of services,” he said.

“It’s a scary opportunity to make some money.”

But Australian Subscription Television and Radio Association boss, Andrew Maiden, said streaming would work alongside, rather than replace free to air or Pay TV.

He said Australia’s streaming market could be worth between $700 million and $900 million, which is around a tenth of the size of the existing TV industry.

“I think its easy to get carried away by the extent to which these services are going to shake up the industry,” he said.



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