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Netflix, Inc. (NFLX) Message Board

  • schweitz31 schweitz31 Jul 14, 2011 6:31 PM Flag

    Broadband Investor Money Drying up in Mexico

    This is not good news for streaming companies like Netflix who rely upon broadband for their streaming delivery into Mexican homes. This is a new big hurdle for their Latin America expansion plans.

    http://www.reuters.com/article/2011/07/14/mexico-broadband-idUSN1E76D1IU20110714

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    • Soon, the broadband network will be moving Wireless -- when 4G and LTE Networks turn on in 2012. At blazing fast speeds that will put your Cable Modems, DSL to shame.

      Should accerate the adoption of NFLX in 2012.

      GET LONG

    • Where is the future NFLX growth in Mexico, Latin America's second largest market, with little to no broadband infrastructure. Please tell me how this will happan? I don't see it happening.

    • I am expecting NFLX mgt. to hold up the international growth card (Latin America expansion) at earnings next Monday during the conference call, especially concerning future guidance. Besides being costly, risky, and harmful to margins in the short term, there remains a serious obstacle to successful expansion in Latin America's 2nd largest market, Mexico. What is that obstacle? No broadband for the majority of Mexicans. I hope that NFLX analysts pay close attention to this information from the above article:

      "Mexico has the fewest wireless broadband subscribers in the 34-member OECD, with just 0.5 per 100 inhabitants, according to December 2010 data. The country also lags in fixed broadband subscriptions, with just 10.4 per 100 inhabitants."

      • 1 Reply to schweitz31
      • Can NFLX afford the huge start up costs in Latin America which comes at a time when NFLX's content costs will be multiplying ten fold (going up close to 2 billion) and their profit margins domestically will be under considerable presure from strong well capitalized companies?

        Expanding to Latin America this year is very risky and not worth the investment. IMO

    • I am not surprised with mobile internet in mexico. in general mobile phones are more popular because their phone infrasytructure is very weak. They had to install digital radio to reach many out of reach places where fiber cable can not reach and very expensive to deploy. Because they have to use a lot of digital radio, these radios are very limited in bandwidth and therefore video services are limited or lower quality. my conclusions are: 1. not many people in mexico can afford video services per month. 2. even when they subscribe video services, month bandwidth will be capped or they have to pay more internet monthly services. look at what happened in canada and from what i read Netflix still struggle there as of today. 3. network quality will affect picture quality of these video services.

    • Investors are muy loco if they actually believe that NFLX will become wealthy from expanding to Mexico and other Latin American countries.

    • If Netflix in Latin America is anything like Netflix in Canada, then it will become a money pit and a financial loss for the company.

      NFLX Canada has been a complete disaster.

    • Latin American expansion is just smoke and mirrors.

      How in the world will Netflix ever expand to Mexico, one of the largest countries in Latin America, when Mexico has the fewest broadband subscribers?

      From article:
      Mexico has the fewest wireless broadband subscribers in the 34-member OECD, with just 0.5 per 100 inhabitants, according to December 2010 data. The country also lags in fixed broadband subscriptions, with just 10.4 per 100 inhabitants.

      • 2 Replies to schweitz31
      • "Mexico has the fewest wireless broadband subscribers in the 34-member OECD, with just 0.5 per 100 inhabitants, according to December 2010 data. The country also lags in fixed broadband subscriptions, with just 10.4 per 100 inhabitants"

        Since NFLX's Latin America expansion plans only includes streaming how will NFLX make a profit in Mexico, the second largest market in Latin America behind Brazil? Anyone?

        NFLX popped $20.00 on the news they were expanding to Latin America.

      • Thats the same as Canada, 10-11 million. It will fail, Spanish selection will be awful, they'll lose money for 2 years and maybe get 2 million subs, but it will still be the best place in Latin America for them

 
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