Netflix in Australia: the story so far

NetflixEarlier this year Netflix made their official debut in Australia, and there is no denying that it is immensely popular. Roy Morgan Research has been following the success of Netflix, and their statistics are able to show just how many Aussies use the streaming service.

Before the launch, it is estimated that at least 200,000 Australians were accessing Netflix through a VPN – a Virtual Private Network that would allow their computer to appear as if they were viewing from the USA.

By April this year – just one month after their local launch – Netflix already had a million subscribers in 408,000 homes across the nation. As of June, this figure had risen to 1.42 million subscribers in 559,000 homes.

Research firm Telsyte has an even bigger estimate, claiming that it is more like 2 million subscribers.

Nobody had anticipated that Netflix would see such a huge success in Australia, not even the company themselves.

Why? Many of its fans see it as simply a better alternative to TV, both free-to-air and subscription TV. Subscription-based video on demand (or in other words, Netflix) puts the power into the consumer’s hands, enabling them to watch what they want, when they want. If they choose, they can spend three days binge watching Breaking Bad from the comfort of their bed – no TV channel will offer you that.

On top of that, there are the perks of no ads, and a very reasonable price; between $9 and $15 a month depending on whether you have 1, 2, or 4 people/devices connected to the account. This is definitely a cheaper deal than subscription TV, where prices start at $25 a month, plus a $150 installation fee.

With so many Aussies getting onto the Netflix bandwagon, let’s look at what Telco’s offer their Netflix-loving customers.

When Netflix launched, Optus and its smaller providers were exclusive providers of a free Netflix trial for their customers. But not that their partnership is over, the Telco’s are set to battle it out for the next Netflix ‘carrot’ to entice new customers.

While Optus offered a free trial, iiNet offer a quota-free downloads on their fixed line and NBN Fibre plans, branding it as a way to watch as much Netflix as you want without exceeding your monthly broadband allowance.

This quota-free plan is still up for grabs from iiNet.

There are also rumours floating around that both Telstra and Vodafone are in talks with Netflix, even though the company does not intend to make any new deals until at least October. Both of the Telcos are keen to attract new customers by riding the Netflix wave.

However, this raises the question: will Vodafone cut their ties with Spotify and Stan if they land a deal with Netflix? We will just have to wait and see.

With Netflix traffic representing a significant portion of all internet use in Australia, Telcos will want to get those users on their network.

Currently iiNet has the highest percentage of Netflix customers at 16.8%, followed by Optus at 11.7%; around 9.1% of all TPG customers are also Netflix subscribers. Only 5.2% of all Telstra customers have a Netflix subscription, but they still have 142,000 Netflix users, which is far more than the 113,000 on iiNet.

These figures show just how important it is for Telstra to get a deal; while they have the highest number of Netflix users, the percentage is key in this situation. Their current low percentage shows that making a deal with Netflix could be lucrative for their business and could boost their customer base substantially.

There are predictions that a new deal could be struck by Christmas, so I guess we will just have to wait and see what happens as the Telco’s fight for Netflix and new customers.

Share this article