After struggling to enter the Chinese market, where streaming services are subject to strict regulations and film and television are often censored, Netflix has finally found its “in.” The SVOD giant has formed a licensing deal with Chinese company iQiyi.com and is set to introduce original content to the overseas market.
Robert Roy, Netflix’s vice president of content acquisition, announced the deal on Tuesday at an industry conference in Indonesia. “China is an important market for obvious reasons; it’s also a challenging market for obvious reasons,” said Roy, according to the Hollywood Reporter. “Right now what we will do is look to license content into China. We closed a deal with iQiyi, which is exciting.”
Despite its otherwise global expansion, Netflix has down played the possibility of moving into the Chinese market. In October, co-founder and Chief Executive, Reed Hastings said that prospects for a direct streaming service in the country were small, and the firm had made no progress in obtaining government approvals.
iQiyi.com is one of China’s biggest streaming services and is backed by Baidu Inc., a Chinese-American web services company. In February the streaming service raised $1.53 billion to take on local rivals in a heavily contested market.
This month Netflix predicted a global increase of 3.2 million subscribers in the second quarter, outpacing analysts’ estimates of nearly 2.4 million.