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Netflix grows to 1.1 million customers in Netherlands

Wednesday 26 August 2015 | 11:52 CET | Background

Not even two years since its launch in the Netherlands, Netflix already has around 1.1 million subscribers in the country. The streaming video service passed the 1 million mark early this year, according to figures from Telecompaper. This makes it the largest subscription video-on-demand service in the Netherlands.

Netflix launched in the Netherlands in September 2013. In the second quarter of 2015, one in seven Dutch households used the service, according to the upcoming Telecompaper report Video behaviour of Dutch consumers 2015 Q2. This includes both paid subscribers and consumers using the free one-month trial.

 

The total subscribers can be multiplied by two to reach the total number of unique users of Netflix in the Netherlands. Netflix offers three types of subscription, for one, two or four simultaneous users.

Seasonal growth pattern

Netflix's subscriber growth shows some seasonal fluctuations. Early in the year and during the summer more customers are added than in the second and fourth quarters. In its best quarters, Netflix added between 165,000 and 185,000 customers, while the low point was around 80,000 additions.

Other video services show similar patterns, for example sports channels attract subscribers during the summer ahead of the new football season or HBO may sign up new customers ahead of the start of a new series. Netflix's better quarters often correspond with new editions of its original series, such as 'House of Cards' in February 2014 and 2015 and 'Orange Is the New Black' in June 2014 and 2015, which result in growth mainly in the first and third quarters.

Better conversion to paid subscribers

Netflix also appears increasingly better at converting customers on the free trial to paying subscribers. The share of free customers fell from 33 percent in the second quarter of 2014 to 24 percent in the fourth quarter last year. This has since fallen further to just 16 percent in Q2 2015.

More recently the company raised the cost of its standard subscription for new subscribers by EUR 1, to EUR 9.99 per month. The standard subscription allows customers to watch the service on two screens simultaneously. The Basic plan, for one screen, and Premium subscription, for four screens, remain at respectively EUR 7.99 and EUR 11.99 per month. Our next survey will show whether the second price increase in a just over a year leads to a slowdown in customer growth. The previous price increase in May 2014 did not lead to any noticeable change.

Netflix approaching 65 million customers worldwide

Worldwide, Netflix added 3.3 million subscribers in the second quarter, of which 0.9 million in the US and 2.4 million elsewhere. This brings it to a total 42 million customers in the US and 23 million in the rest of the world. Average revenue per customer rose 5 percent thanks to the introduction of new subscription options, mainly the possibility of HD access with two simultaneous streams.

In the current quarter Netflix aims to add 4.3 million steaming customers, to take its total base to 69.1 million. The company plans to expand its service worldwide by 2017.

Dutch Netflix users watch less linear TV

Dutch subscribers to Netflix watch less linear TV than households without Netflix, according to figures from late July from the Telecompaper Consumer Panel. Netflix subscribers watch almost a third less live TV than non-Netflix subscribers, equal to around a half hour per day less.

A Netflix subscriber watched on average one hour per day of Netflix or other over-the-top VOD services, such as NLziet or Videoland Unlimited. That's 57 minutes more than non-Netflix subscribers, underlining that the market for other OTT video services in the Netherlands is still very small.

More information about Netflix, video content and TV viewing is available in the Telecompaper report Video behaviour of Dutch consumers 2015 Q2, which will be published in early September.



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