In a refreshingly frank exchange, a former LoveFilm CEO said that if Netflix has decided to launch in the UK as planned back in 2004, it would own the video streaming market here. Recent figures released last month showed that Netflix is used around half as much as LoveFilm‘s streaming service in the UK.
Original LoveFilm CEO Adam Valkin said that it would have “been a different story” if Netflix has chosen a different launch strategy, though. In 2004, Netflix originally planned to launch in the UK, but dropped out because of competition from Amazon. As Valkin explains, “[Netflix] decided the day before they launched to pull out, because Amazon had announced they were going to launch in the UK. So Netflix said ‘well, if Amazon are going to launch in the UK, they’re going to launch in the US, which means we’ve got to go back to the US and worry about the US and let them have the UK.”
It took Netflix eight years to launch in the UK, having started flinging out films to us UK folk in January 2012. Netflix shares fell by 25 per cent following its latest round of financial results, with slowing sign-ups reducing income by a dramatic 91 per cent. Would this too have been different if Netflix had expanded more quickly?
On the other side of the divide, LoveFilm was eventually bought by would-be rival Amazon in 2011, in a £200 million deal.
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Read our Netflix vs LoveFilm feature