Netflix, Inc. (NASDAQ:NFLX) must have something on their mind, as they are planning to bring their $8-a-month streaming service to Cuba, a country where the average income is just $20 a month. Is there a thought of long-term benefit behind this strategy or is it just a publicity stunt? Of course, it’s a publicity move, says Brent Lang of Variety Magazine, who was on CNBC today to discuss what’s likely behind Netflix’s motivation to enter a country like Cuba where less than 1% of the people have broadband internet access.
“This is really more about Netflix trying to get some attention for itself and also planting the flag and anticipating that now their (U.S-Cuba) relationship is normalized, the economy there will start to grow and strengthen, more internet will be available and they will be sort of first pioneer in that sector,” Lang said.
Maybe this move was taken by Netflix, Inc. (NASDAQ:NFLX) because of the agreement to normalize relations between the United States and Cuba, which included a deal to ease the restrictions on the internet of Cuba. But most of the people in Cuba use a slow dial-up connection to have access to the internet. Some of the famous hotels have internet cafes with faster connections, but most Cubans cannot afford to use such a speedy internet.
Netflix, Inc. (NASDAQ:NFLX) always tries to stay ahead of innovations and be a pioneer in its field, as it moved quickly from a rental service business to a media streaming platform and then became a content creator. Netflix, Inc. has also taken a greater step into foreign markets through the last year, expanding into six new European countries, including Germany and France.
“It is a positive move on the part of Netflix, a brilliant one because Cuba is in the headlines but you have to remember that this is the company that turned the announcement of a new Adam Sandler film into a huge global event, so they know what they’re doing in here and they certainly got a lot of attention,” Lang said.
Now, Netflix, Inc. (NASDAQ:NFLX) can be proud of itself that it’s the first major streaming video service to enter Cuba, as Netflix presents itself as a global entity that encourages the unity of the people through its content. It took advantage the news surrounding Cuba and turned it into a business advantage. It will be even more interesting to see the reaction of other competitor companies like Google Inc (NASDAQ:GOOGL)’s YouTube, Amazon.com, Inc. (NASDAQ:AMZN), and HBO; will they follow Netflix into Cuba, or come up with some new and more impressive strategies?
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