How Netflix Is Doing In Australia: Two Stats That Should Scare Foxtel and Quickflix

Netflix is rumoured to enter Australia early next year, but that doesn’t stop a few enterprising Australians from accessing it now. Actually, it’s more than a few.

Andrianes Pinantoan is Head of Growth for Australian-made budget planning and financial management app, Pocketbook. Download the app for iOS and Android, or check out more on the Pocketbook Blog.

Up to 200,000 Australians are signed up with the service. There are also many anecdotes about the popularity of Netflix in Australia in the forums and social media. So we decided to look deeper into the subject.

Let’s start with the basics: stat 1 – market share.

Our study found Netflix to be the second most popular paid-content media company in Australia, despite the fact that they are not officially available here and that they are actively geo-blocking Australians. Here’s a breakdown of the market (click on the image to get a bigger picture):

That’s right. Netflix owns 27 per cent of the Australians currently using media subscription or rental services. And as you can see, it has tripled in size from just 9.88 per cent in January 2013.

But the growth didn’t come at the expense of the local dominant player: Foxtel. The growth came from the old-world end of the market: rentals and to a lesser extent, local clone – Quickflix.

I should note here that the graph is based on the number of users (popularity) as opposed to dollars spent (revenue). And that means it doesn’t take into account metrics such as:

  1. The number of transactions per customer. For example, if a person frequents Blockbuster twice a month for a year – we’ll count them only once.
  2. How long Netflix, Foxtel and Quickflix customers are subscribed for. See below for explanation. The fees they charge. Netflix might be growing in popularity in Australia but they charge around $10 a month. Foxtel, on the other hand, can charge more than $100.
  3. So it’s true that Netflix is growing in popularity in Australia, but only among people who perhaps can’t afford (or simply refuse) to pay Foxtel’s fees. For those who are comfortable with paying those fees? They are happy to keep paying for the convenience Foxtel offers (in that they don’t have to go through a VPN service to combat Netflix’s current geo-blocking of our great country).

Another interesting thing to point out are the tiny grey bars at the top. That’s a lesser known alternative to Netflix: Amazon Prime. From what we can tell, it only started to gather momentum in Australia from September 2013, but as you can see, it has also grown – again, despite actively blocking Australians.

And although by number of users Amazon Prime is small in Australia, they charge an annual fee as opposed to a monthly fee. So by dollar amount, it’s actually quite significant. Again, the annual charge is a fraction of Foxtel – around $100 for the year.

How long did the subscribers stay?

The next stat of importance is how long subscribers stay with a particular service? This is a good indicator of how satisfied they are with the particular service.

But there’s a catch with calculating average subscription length.

If Service ABC has been around for 10 years and Service XYZ has been around for 1 year. Let’s say users of ABC stayed for an average of half the time and users of XYZ stayed for the whole time. ABC in this case would still appear to be doing better than XYZ because ABC would have an average subscription length of 5 years. Where XYZ would only be 1 year.

To do the right comparison, we need to do what is called a cohort analysis. That is, of users who start a service (sign up) in a particular month, how long did they stay for?

In the example above, we would look at only people who subscribed to ABC and XYZ with the same time period – to compare the two “cohort”. So what we might see is that ABC only has an average subscription length of 6 months and XYZ, 1 year.

So we did that analysis for Foxtel, Netflix and Quickflix. Here’s the data (our last date in the sample is 31 June 2014):

As you can see, Netflix users stay around the longest and Quickflix the shortest. Australians who signed up to Netflix in January 2014 stayed, on average, for 110 days (roughly 3 months, 20 days). Those who signed up to Foxtel during the same period stayed for slightly less than 80 days (2 months 20 days).

Another point is that given the effort it takes to set up Netflix in Australia, namely the research and setting up of a VPN service, there is more incentive to keep subscribing given the sunk cost.

Quickflix appears way down the list as unlike Foxtel and Netflix, they also offer once-off purchases of premium programmes. And it appears a lot of people bought these once, and never went back.

Market Share vs Growth

This is such an important note, I have to point it out to avoid any confusion. It is absolutely possible for a company to grow, yet have a shrinking market share.

That happens when the overall market is growing. The company is enjoying that growth, but at a slower pace than its competitors. So the fact that you’re seeing Quickflix’s market share decrease in this dataset doesn’t mean the company is in trouble. In fact, it might be subscribing more users than ever.

And the fact that Foxtel has a steady market share doesn’t mean they are not growing in profitability. In fact, what this graphs shows is that the company has consistently grabbed 50% of overall market.

It just so happens that Netflix is getting more of the growing pie than they do, remarkably without any Australian marketing or formal Australian servicing channel.

It will be interesting to see how this develops. Who do you think will come to dominate the industry?

On Our Sample

This study didn’t include iTunes, Google Play, Spotify, Pandora and Xbox purchases. Our sample size is 21,000+ Australian consumers only.

Is a 21,000-subjects sample big enough? By way of comparison, Nielsen Television Audience Measurement – the definitive measure for Australian TV ratings success in the industry has about 5,000 Australian households, and OzTam, jointly subscribed to by Seven, Nine and Ten, has 4,913 homes on their panel.

Note that Foxtel has a lot of business subscribers – company kitchens, meeting rooms and bars – they would be excluded from the sample.

Read more on the Pocketbook Blog!


Comments

    Just a further illustration of our sample:

    Pocketbook users come from a variety of sources, the majority of our users (more than 50%) have come from mainstream media coverage and word of mouth. Coverage on media such as News.com.au, SMH and Sunrise.

    We also get over 100 emails everyday from our users and that gives us a sense of who they are. Some of them are as young as high school students managing their pocket money to retirees looking after their retirement. Empirically, our sample is definitely broader than young males - we can tell just by looking the amount of expenses categorised as "childcare" and "retirement", as well as spending in retailers like Sportsgirl and Katies.

    Our sample for this research is the anonymised real spending information from 21,000 Australians. All our results are concluded by aggregating this sample. This sample is pared down from a larger growing user-base of 85,000 to be representative - we've employed statistical methods such as k-means data sampling, and using sample-on-sample historicals in doing so.

    As a relative measure, Nielsen TV ratings is calculated from 5,000 households across Australia.

      Any data for iTunes? Also for Aus vs US iTunes?

      very interesting usage of data. I would like to have seen how the data looks once iTunes and Google Play data is included in the mix. Especially iTunes as they have sold quite a few apple tvs in Australia and is probably the most widely used legit download software.

        Hi A.X (and also Gizmac), unfortunately we cannot determine what people buy. We can only determine who they paid. The problem with iTune and other app store is that people might be buying apps or music instead of movies - we can't distinguish that.

    So any word on price for Netflix over here yet?

      That's my main concern - if they do come to Australia will we get the same content at the same price as the US? I had a look at Quickflix and the selection is just sad... it's like looking at the weekly rental shelf of a mid-90s Movieland video rental store.

      I've just recently got Netflix and am loving it. But I suspect I'll probably just keep my US subscription since I can't see the Australian version being any better (or even just as good), and it'll probably cost double the price.

        It won't be the same content at the same price. It just won't.

        You only need to login to netflix using a gateway in europe to see that.

        Australia, like europe, already has a lot of content that is on netflix now (eg orange is the new black, arrested development, House of Cards) tied up in pay TV contracts. Foxtel is not going to canabalise it's own streaming business and for that matter it's own presto movie streaming service by allowing netflix to show all the TV shows and all the movies they do in the US now.

        The only advantage we'll see in Australia is better device compatibility because foxtel is heavily tied up in Samsung & Apple exclusives, and quickflix is using dead Silverlight technology.

        Netflix can run on just about anything with an internet connection.

      I think price is secondary. The primary concern will be what content is available. The precedent has already been set by Netflix. Canada and the UK have different content to the US and a feir bit of the US content is unavailable elsewhere.

      I fear we will get the same treatment. Yay netflix is here. You can watch Blue Heelers, Home and Away and Neighbors. Yay.

      I'm flexible on price. Hell, I'd probably pay foxtel prices IF the content was good and on demand. I get a huge amount of use out of my Netflix account so I could justify the cost. Obviously $8 per month is amazing value but even somewhere round $25 would acceptable. Especially if there were local servers and you won't have to worry about VPNs ect...

        Obviously $8 per month is amazing value but even somewhere round $25 would acceptable. Especially if there were local servers and you won't have to worry about VPNs ect...

        That's where I differ from you - $25 a month is completely unacceptable to me if the US one is $8 per month (plus about $2 or thereabouts a month for Getflix or whatever your chosen method of getting around the geoblocking is). Local servers doesn't bother me - I have no issues with the performance using the US servers. I'm not going to pay 2 or 3 times that just for the privilege of not having to bypass their geoblocking bullshit. Give me the same content at the same price and I'll buy it, otherwise I'll just stick with my current arrangement.

          Totally agree, you might as well get foxtel for that price.

          Under $20 and I'm sold!

          Unfortunately, even switching between the UK and US version of netflix you can see a huge difference in content. I imagine the AU will likely mirror that of the UK version... Which is better for movies, but the US netflix has way more variety in television.

          I imagine even if it's released here, I'll keep the the my unblockus account so I can still change between the regions.

      i'm guessing twice the price for half the content.

        Yep that's about what it will be - around $15 a month and expect to see things that have had a first run on free to air.

        Look at the google play store - do you pay your $4 per episode for US TV shows that aired in the US last week? NO. You only see it on there after it's aired on Australian free to air which could be months behind. The Simpsons/American Dad/Family Guy/Futurama are good examples of that.

      If you're using any VPN, you can pretty much get it for the same price as in the US right now if you want. That is of course if the VPN server you are connected to is also in the US.

      You can google the rest. It's pretty easy to figure out. Here's a guide: http://www.bestvpnservice.com/blog/netflix-australia-watch-everything-without-restrictions/

    Not only is it cheaper to have Netflix US, but as I was an existing subscriber I get two years locked into their old price before I see the price rise. Name an Australian company that would do that as an incentive.

    Hi,

    Firstly I think we need to ask for some more information here from Pocketbook-- about the sample size and how well that translates to the population.

    Secondly if there are a lot of users of Netflix via VPN (ie unauthorised bypassing geoblocking) then that's cause for concern for the Australian industry and consumers longer term. Netflix is getting a massive free kick without having to secure license rights in Australia and without paying taxes on Australian revenue. Meanwhile Quickflix is missing out on revenues and the opportunity to reinvest those into more content and attract more customers. So local competition suffers leading to a more dominant Netflix --- how do you think Netflix will behave if they were left to flex their market dominance? Jack up prices.

    Support local the Australian company looking to compete.

    Stephen Langsford
    Founder/CEO Quickflix

      If they jack up the prices "to match the Australian market", the most obvious will happen: People will still stick to VPN & US Netflix or not bother with it and continue to pirate, because there is an alternative to choosing the lesser of two evils: an inflated Netflix or Foxtel.
      Not going to mention other streaming services, as their service is just as terrible.

      How does Netflix avoid paying taxes on Australian revenue? Have they set up a tax haven in the Bahamas specifically for charging Australians or something?

      Unfortunately (for you) we live in a connected world and if Netflix are going to offer the best service, I'm going to sign up with them when the nbn hits my place at the end of the year. From what I hear they have a larger selection of TV and movies available.

      They already heavily dominate the market in the states and are cheap as chips still. Even with their recent price rise. There's no reason to worry about that.

      I already spend a good deal of my 'personal' money overseas anyway as Australian prices are rubbish.

      Support local the Australian company looking to compete.

      Give Australians a fair and acceptable alternative and they will come.

      As it stands, local distributors cannot help themselves and adapt so why should Australians support indirectly via services such as Quickflix?

      Secondly if there are a lot of users of Netflix via VPN (ie unauthorised bypassing geoblocking) then that's cause for concern for the Australian industry and consumers longer term.

      No, it is not: it is a sign the market needs to adapt and change. To use the analogy from Louis CK, this cage distributors seek to create has effectively kept potential money out.

      There is also Google who have echoed what Australians have been saying for decades: there is a pricing and availability issue here.

      Meanwhile Quickflix is missing out on revenues and the opportunity to reinvest those into more content and attract more customers.

      The problem is not with consumers: it is with the distributors/copyright holders that provide the content.

      Last edited 15/07/14 12:57 pm

      I tried QFlix and was left very dissatified, I've used Netflix in the US and love it (haven't made the effort to use it here though).

      QFlix are way overpriced and last time i checked way too little content. Maybe not all the providers fault, the content producers/owners over charging and placing too much restrictions on content dissemination plays a part too.

      I'm more than willing to pay for local services if its priced well and provides what i want, nothing here does yet, if netflix can come here and provide that ill sign up with them, if QFlix can do it ill sign up there.

      Mr Langford, as a former Quickflix customer I can summarise the reason why I cancelled my sub in three words: Not. Enough. Content.

      The selection of movies available for streaming was relatively small (500 or so?) and dominated by older titles (the sort that would be relegated to the back shelves in an old video store) with very little noticeable addition of new material. This was admittedly a few years ago but I checked a few months ago and didn't see much change since II cancelled my sub.

      I don't subscribe to any other streaming services at the moment, except for Crunchyroll at US$15/month for their premium service. I also spend s few hundred dollars on DVDs per month.

      Crunchyroll is an interesting case here as they're basically a niche provider, but it happens to be a niche I'm interested in. As far as I can tell, their library is growing faster within that niche than Quickflix's library is growing across all genres. To provide similar value across all genres, Quickflix would have to increase the rate at which they're adding new material quite substantially.

      As it is - take your (smallish) library, subtract the material I'm not interested in, and what remains isn't worth $10-15 per month to me. When I originally subscribed (when the PS3 app was introduced) you had what looked like a decent starter library, but growth was a tenth of what I had expected when signing up. The blu-ray postal mail service I didn't use at all.

      I'm aware that licensing new material is an expensive and tedious process. However, ultimately that's not my problem - unless I choose to make it my problem by signing up as one of your subscribers. That won't be happening unless I discover that there's been a major push for new content.

        Thanks for all the comments and replies. One thing is for sure we are constantly improving and expanding our range-- if you're someone who tried Quickflix 6 or 12 months ago give us another go please or consider us in the future. We have added a lot of streaming content and now offer subscription streaming only $9.99 per month as well as Premium movies and currents season TV for pay per view/per ep. Quickflix has HBO catalogue series in subscription as well as Premium current season content. So we're expanding the content range and expanding the devices you can access Quickflix through. Netflix doesn't have any HBO content and doesn't have latest release movies pay per view. We're not after support simply because we're an Aussie player-- we know our content, service, value proposition has to stack up-- it does today and we'll only get better. There was a comment on this board about living in the past because we still offer DVD-- we're proud of our DVD service and it still caters to a large market segment (as Netflix's DVD service does in the US) but all our energies are directed into streaming and improving the customer experience.

        OK we'll keep beavering away folks -- if we can get our service to a point where we have you guys cheering us I know we'll be doing well.

        SL

          Thanks for taking the time to connect with the people who could be future customers. I use Netflix after being frustrated and pissed off with Foxtels overpriced and ad laden outdated service. What would make the difference in your case is simple, in my opinion. Quality, quantity and price. HD content, range and variety of content, and a price that even those who wouldn't even think of subscribing, think of subscribing. I run a service business. The recession we had to have almost killed my business. I did two things that changed everything. I actually dropped my prices to keep clients from dropping my service, and sought clients who weren't in my target range. Today, I can't keep up with demand in peak times (which is now 6 months of the year) and word of mouth takes care of 99% of my advertising. Crazy, ay. I would go after all content distributors, even the FTA channels, to get as much diversity as possible. How about a retro Aussie channel that runs the shows the baby boomers (a lot of them out there) grew up with. Shows that haven't seen the light of day for decades. Cop Shop, Homicide, Graham Kennedy's IMT, Don Lane show, Hey Hey its Saturday, shall I go on? Sometimes to go forward, we need to look back. You only need see how much baby boomers pay for iconography from their youth. Cars, toys, collectables, its nuts. I understand Quickflix is to come to Chromecast and Apple TV sometime this year, and there's your courier. Content across all platforms is cheaper and someone elses issue to purchase. Foxtel has locked itself into expensive hardware distribution. Thats just last century thinking. Please consider low cost, high diversity and something nobody has thought of, retro Australian content. I'd buy that.

          I have to say that engaging as you have is a very good sign, and the direction you are taking is a good one. I don't envy you the challenge of competing in Australia's media market. Roop has never enjoyed friendly competition. Still, the longer foxtel and village executives come out insulting their target market for not acting the way we acted 30 years ago you'll continue to have a good shot at it

          I'm one of the evil-doers that still pirates as not one of the services meets my expectations.

          I haven't gone the route of VPN/Netflix as I cannot guilt myself into paying Netflix for something I can still acquire for free.
          If there was no Geo-blocking, I'd likely join Netflix but I am suspicious that Geo-Blocking is just a tool for getting people outside of a region to bypass the block as there's more than enough mainstream press talking about VPNs to make general awareness of VPN's quite high.

          If Quickflix can start offering 1080p streams of new release series for say....$10-15 a month - you will have me as a subscriber.

          I wont bypass Geoblocks (until laws change requiring me to cover my arse) and I wont sign up for anything but the best.

          Until then - TPB reigns supreme.

          At face value, as it stands, Quickflix is still sadly the example to trot out of how any excursion into Australia is going to come saddled with a higher prices for a reduced range.

          I can't imagine how frustrating that might be if you're trying to fight that, and engaging without accusation is noble and praise-worthy, but...

          Face value is what moves the money.

          I do have one idea I'll toss you for free: "Steam TV."
          If you're not a video gamer, I'll explain: 'Steam' is a digital distribution platform for video games which uses some very clever and lucrative but well-received methods for selling and distributing games online, with an integrated social platform, especially well-known for its popular sales events which are not only popular with consumers but also publishers and studios, who report massive takings and boosts to the tails of their product in the weeks and months following these events. Steam is not unreasonably credited to have almost single-handedly carved out a profitable space for games in what has typically been considered a haven of online digital piracy.

          Anyone who says you 'can't compete with 'free'' is talking out of their ass. You absolutely can compete with 'free' because price is only one factor amongst many which influence a purchase (or lack thereof) decision.
          People buy games on Steam that they would otherwise pirate for one very simple reason.
          That is, consumers value certain properties in their choice of products: 1) price, 2) quality, 3) availability, 4) accessibility.
          Steam's success lies in surpassing the free alternative in all three other aspects, then closing the gap on price so much that it becomes a value decision for gamers to pay the price to get the other benefits.

          It won't take very much research for you to identify how the Steam platform surpasses ripped/pirated copies of games in these key areas. Transposing their approaches to video without any original thought is STILL a recipe for success. (Albeit an expensive one which would possibly prove almost impossible to convince content-providers to get on board with. But that's the distributor's job.)

          As it stands now: official, paid, legal versions of most video entertainment fall down not only in price, but also fail to compete in quality (laden with ads, piracy warnings, clunky menus), availability (thanks to exclusivity limiting titles available, not all of them within the country, and even when available, not available at the same time as the American ie: pirated versions), and accessibility (being restricted to certain platforms, devices, proprietary DRM tools).

          You can compete with 'free', but only if you can compete with any other aspect of the product. Currently, legal methods can't compete with pirates on ANY OTHER ASPECT of the product. When geography was a barrier, distributors held the power. Now that the internet has no barriers except those which are artificially manufactured (and easily bypassed), they do not hold the same power. This is why things are as they are.

          I am quite certain that if you are to convince content providers to change their attitude, you will need to show them an incentive, and if past industry-insider articles are anything to go by, the people at Valve (the company responsible for Steam) are more than happy to provide detailed evidence about the impact of their distribution model on both piracy and sales.

          If too many factors are keeping you from being able to compete with 'free' by keeping you from being able to compete on quality, availability, or accessibility, then I don't even know why you're trying to break into this business.

          My dictionary is broken, I thought current ment just happened (maybe even a year), not tv shows that were first viewed in 2010-11. "currents season TV for pay per view"

      Hi Stephen, nice of you to join the conversation and I hope you continue to read over the comments as they come in. Unfortunately I don't think there will be a large amount of support for you at this point given the past discussions in this area. As many here will tell you we have a locked in price for the next 2 years, what happens after that?? Time will tell.
      To tell us to support a company for the sole reason of it being Aussie owned is a hard line to take, can you honestly say when given the choice of a great product made overseas and a lesser version made here you would choose the in favour of the latter. Before you answer be sure to look around your home and workspace.
      I understand your problem but I don't feel I should jump onto your service with the hope that one day you will begin to provide what I already have.
      I see two areas that you could build on that would move many subscribers to your service, these would be HBO and Sports. I would hate to think the of the cost involved here and in both cases you are taking on Murdoch but on a plus side people here generally take the side of anyone having a dig at Rupert :)
      Hope you continue to be involved in the forum. Cheers

      Ok as a consumer what am i most likely to go for? an expensive local service that offers very little or a non-local service that is cheaper and offers more?

      It's a simple question.

      Hi Stephen,

      Good to see you post and engage with consumers.

      I was a subscriber to Quickflix for a time, when the service came to PS3, quite early in the streaming service I think. I really wanted it to succeed and become a true "Australian Netflix". The problem, as others have already stated, is that Quickflix just does not have the content. It only took a couple of weeks to watch most of what I could find that was of interest on the service and new content was few and far between.

      I've been a Netflix subscrber for 6 months or so now and the difference is huge. The content library is massive, new content is constant and there is even a wealth of exclusive content that is actually very good. And it is cheaper, better supported on more devices and better quality.

      I know there is a problem here. It is hard for you to secure rights without money, hard to get support from distributors without a solid base of users, hard to compete with Foxtel's marketing and clout. But even understanding that, as a consumer I go with the best service at the best price. I can't pay you in the hope that one day you get better while also paying for Netflix to watch House of Cards. Not many consumers will act like that.

      As others have stated, the problem is with distributors and rights holders. As long as they can get a bigger return from selling exclusive rights to Foxtel/Village etc then that is where they will go. As shown on the graph in the article, despite the rise in streaming Foxtel's marketshare remains steady (although I'd be interested if adding Google Play/iTunes data changes this slightly). The big transition still taking place is the move from rentals to subscriptions.

      In my view, going with Netflix over Foxtel is a step toward Foxtel eventually not having the big money to throw around. It's also a decision I make because Netflix is actually a better service than Foxtel, even were they the same price (except for sport). Perhaps once the market continues to shift and Foxtel starts to lose share there will be a shift by distributors toward an Australian based subscription service. Whether that service is Quickflix or Netflix doesn't worry me - I and most others will go with the best service at the best price.

      Who knows, maybe Foxtel cut their prices on Go and Presto, roll them into one product, upgrade it to HD add streaming sport and take the whole market. I'm not fussed on who does it, I'll just go with who does it best.

      Last edited 15/07/14 2:08 pm

      Stephen, I currently subscribe to Quickflix, but only for blu-rays. I would dearly love to stream your content, but I'm not going to pay extra for that when there's not the content, and the quality is appalling - worse than DVD more often than not. Another reason is the lack of 'app' for the WDTV :(.

      Thanks for taking the time to read and reply.
      Ultimately it's a catch 22. You need the users to expand but you need to expand to get more users.
      The bottom line is getting content from publishers and studios is an expensive and archaic task. Movie and TV studios haven't caught up the global distribution systems like the music industry has. I actually find it quite baffling since the model and the groundwork is already there.

      With regards to Quickflix.... Postal services are going the way of snail mail. I don't believe there is much point is keeping that service running. Obviously I don't have your data but I believe that a company such as yours has to look to the future not the past/present.

      As has been stated millions of times on websites like this one, the way to beat piracy and keep users is to provide all the content they want, when they want at a reasonable price.
      Foxtel is not reasonable because it's expensive (due to having a monopoly) and is not on demand. Oh and still shows as many ads as free to air TV.
      Quickflix is not reasonable simply because the quality and quantity of content is no where near what the competitors offer.

      Now, sure that's because Netflix has a different business model and much different access to the content... but that comes down to the content creators and owners not the distributors. Services such as yours, Netflix, Hulu etc should be the ones pushing the studios into this century.

      Netflix has actually changed immensely in the last 2 years. I remember trying it, probably 2 years ago and I wasn't overly impressed. Catalogs were small, I actually couldn't find anything i wanted to watch. Especially when compared with just torrenting a show.
      Fast forward to the release of Season 4 of Arrested Development just over a year ago. I jumped on a free one month trial because hell it's free and I would have just torrented the season anyway.
      I've never looked back. Yes it would be great if it had current season of shows. And yes it's still missing a lot of good content, but it's always changing, always growing and always evolving.
      Was House of Cards such a hit because of how good a show it was or because of how it changed the TV industry? I like to think it was even parts of both. Orange is the New Black is now doing the same thing.
      Obviously not every company has the money or resources to fund their own show, but it's clearly showing how the TV industry can change and evolve. And that's what's important here.
      NZ ISPs providing free VPNs for their customers is another example of how a company is changing the status quo to benefit their customers. Uber vs Taxis is another example.

      Not everyone has to be a trend setter but you're now in a position to make a difference in an industry that desperately needs change.

      Hmm, looking at the QuickFlix page there is a subscription fee and then you have to pay for "premium" content on top of that... So give us an example of a premium movie and TV show that we'd have to pay for?

      Because I'd genuinely like to know how it compares to bricks and mortar rental places. I'm just going from the website (and it's a bit hard to work out) but it looks as though say "Dallas Buyers Club" will cost $5.99 to stream. That's on top of the $25 monthly subscription right? So how is that better than renting it at the shop down the street for $6 any night or $2 on a Tuesday? And by the look of it, a lot of the movies that are included in the subscription are the ones I can rent from the same store down the road for $1 a week.

      I love the idea of online streaming from an Australian company but it really doesn't look to offer a better alternative to just going to the local video store and renting.

        I pay $9.99 per month for Quickflix streaming not $25 as you indicate

          That's typical, now I can't find where I spotted the $25 a month figure on their site. Either way, the question still stands. The movies that look new and interesting all seem to be the same price as renting from the local video store with a $10 charge on top. Sure you can stream a bunch of stuff for that $10, but again they're the ones that are $1 a week at the video store.

      instead of looking to compete you could instead look at being competitive.

      Support local the Australian company looking to compete.

      I think it's the other way around - start competing and people will support you.

      Altruism isn't a strong selling point unfortunately.

      The fact that this is a concern for local rights holders shows how out of step the current business model is with the real world. Consumers are years ahead and the only responses that local businesses can muster is an appeal to Nationalism - and threats.

      You are the reason I pirate shows.

    Well if they come to the market and do what every other greedy company that trades in Australia does ie: charge double or more
    Myself and many others will simply continue to access all the free 'wink' content that is available
    ITS THAT SIMPLE
    There is simply no excuse for a company to charge Australians double or more for the same product or service
    Any excuse 'spin' they try and explain the complete lack of parity with is just pure and simple gibberish 'corporate lies'
    That's my opinion and of that opinion I'm certain, there is no compromise

    The problem is News Corp. It always has been. Even back in 2003 Telstra deliberately limited our ADSL to a crappy 1.5Mbit (ADSL1 is capable of 8Mbit) because it was scared video streaming would eat into Foxtel's revenue.

    News Corp. wrangles deals with the content rights holders, and through this bastardry they then try to funnel us into their overpriced Foxtel.

    If another player could offer a better exclusivity deal to the content rights holders, only then will we see the grasp of Foxtel loosen. Unfortunately Quickflix does not have the clout. Netflix could, but only if it wanted to.

    Even better would be if the content rights holders refused to enter into exclusivity deals - let anyone distribute their content for a fixed, published and fair price. Ha ha ha ha... in me bloody dreams!

    I would be sceptical of this being a true representation of customers across Australia. This being pocketbook users tells me that while they may have sampled 21000 the percentage representative of Australia would be very small indeed

    I'm sorry, but there are some serious flaws in this analysis / article that I feel I have to comment on...

    No offence to the author, but whilst a sample size of 21,000 sounds impressive relative to the 5,000 panel used to determine television ratings, the comparison is irrelevant. One is being used to measure TV ratings, the other (in this case) market shares etc. Whilst I think both are too small, the bigger issue is whether the samples are both large enough and representative enough of the Australian population.

    Within Quantium, we are fortunate to have access to the de-identified bank transaction data of over 2.5m Australians. Similary, we have over 300 actuaries and analysts to crunch and analyse that data.

    Rather than describe our data as being representative based on 100 emails we receive each day from a mix ranging from high schoolers to old retirees, we ensure our sample benchmarks exactly against sources such as the census and ABS and sales figures declared by public companies.

    Without revealing any confidential information, the numbers we get are very different to these.

    To illustrate the point, the article suggests Netflix has 200,000 subscribers which translates to a market share of approximately 27%. In the same analysis, Foxtel is suggested to have a market share of 49%. Unless I'm completely missing something, the conclusion from that would be that Foxtel has just 363,000 subscribers (200k * 49/27). Do a quick Google search and you can see that Foxtel had over 2.5m subscribers this time last year.

    Similarly, the second analysis is just as bad. Does anyone truly think that the average Foxtel subscriber sticks around for just 80 days? Please.. Almost all subscribers have to sign up to 6 or 12 month plans for a start. I understand it's a 6 month cohort analysis etc, but there is something very wrong with either the calculations underpinning the analysis or the underlying data.

    To then top it off, the analysis contains data up to 31 June 2014. That will do me.

    Adam Driussi
    Founder, Quantium

      They must have got some pretty special data on 31 June ;)

      It does seem odd, I wonder if they are only counting a subset of Foxtel customers? i.e. not just those that watch the broadcast content??

      Within Quantium, we are fortunate to have access to the de-identified bank transaction data of over 2.5m Australians. Similary, we have over 300 actuaries and analysts to crunch and analyse that data.

      Seems that with this data you are in the best position to give a real number of Australians sending $8 per month to Netflix. Do you see similar numbers of Netflix subscribers?

    Just came here to say nice piece of marketing, this is how it should be done. Provide the audience with something interesting, mention your brand but down ram it down peoples throats, and watch the traffic/users come in :)

    Also, nice job with PocketBook. About time MoneyManager had a real competitor since ANZ haven't done much with it besides a few UI updates. Although the Yodlee-based categorisation is still ahead.

    I do so enjoy reading all these interesting comments...

    I myself am a stupidly mega consumer having Foxtel, Netflix and Quickflix and all of them serve some purpose in my uber consumer lifestyle

    I am an off and on again Foxtel user, it does seem to me that there is a hugely high level of repetition in their programming although it is better than it used to be, my main gripe with Foxtel is that I am paying for a premium service which now had adverts in it...seriously this sort of sucks, in the old days there were no adds. However for convenience and for the children it is an ok ish investment although would be the first thing to go if I ever needed money

    Quickflix exists in my life because I gave it a go once and never got around to cancelling my subscription, however it does come in handy when a member of my family with a i device is in hospital or away somewhere and wants to watch streaming media, although I will comment that the 700mb for an average movie on an ipad seems a bit of overkill.

    Netflix I have because well it's netflix. I have a 5 devices around my family that all have VPN software and the Netflix app, it's fast, it adapts to the connection you have and it works and is cheap. A little bonus is that if there is something on Netflix that is geoblocked in the US but available in Netflix UK I just change my VPN connection and the same userid and password gets me that countries streaming. I found that out by mistake one day but it is handy. The other reason for Netflix is some of their inhouse productions are really good.

    Now for the Quantium thing....I formally disapprove of my data de identified or not being used for any sort of profiling and will from now on carefully check the stated privacy policy of all institutions I deal with to make sure that they do not declare that my data may be used for such purposes, as I am pretty sure under the new privacy act such use would have to be declared. I opt out of loyalty schemes etc for the same sort of reasons, I hate not being able to get certain services or even groceries because some stat person has decided that due to the profile of people in my area and spending patterns my local stores will not stock certain things.
    I would also point out that until recently Netflix would only except a US credit card for US service payment or one with no defined address in the cards identifiers making pre paid or online credit cards the payment of choice. So that would severely affect the way that any analysis of services was done as a number of these are fairly untraceable back to their source without a lot of leg work and identifiable information, of course nothing is impossible.

    And I don't see geo blocking as a really valid thing even our government cant decide if its a valid thing or not

    http://www.abc.net.au/news/2013-07-29/geo-blocking-mps-committee-price-report-apple-adobe-microsoft/4850484

    http://www.kotaku.com.au/2013/11/the-australian-government-supports-geo-blocking-that-could-drive-up-video-games-prices/

    We live in a global village, now. We are connected to our international neighbours every day. We talk to them every day, we hear what they have to say, every day. We see what they see, we access what they access. Digital media is a huge part of that, it's part of the conversation we have, it's part of what we react to, talk about, how we relate.

    Trying to wall off part of that global 'conversation' (which includes entertainment media) as not having to follow the same natural order that the rest of the digital conversation has, is not going to work. It's not working, now.

    Australians are asking: Why do I pay double for what I see my neighbour paying? Why can't I buy it at all, or only weeks or even months later? Why can't I get what my neighbour gets because of nothing more significant - digitally - than an IP address?

    These are the questions whose answers rely on 'how things have always been done'. These are answers that only make sense in a world where media was difficult to distribute, and where geography actually made a difference. It doesn't anymore.

    These are the questions whose answers don't make sense to a rising generation who have never known a world without the internet. You and I might remember, but as much as you might like to think of Gen Y or the Millenials as 'kids', they're in their fucking thirties and mid-late twenties now; raising children, buying homes, qualifying for long service leave.

    This is the world now.

    So when the answer, "Because we said so," comes back, in an ecosystem where ignoring 'what is said' is fast, easy, utterly free of consequence, and very often a better quality product, free of ads/unskippable menus/portable to any platform, then that answer is getting laughed at. Literally. That business of distribution isn't as hard - and isn't as VALUABLE - as it was. It doesn't have the vice-like grip it used to, because it has no power. It doesn't want to die, but it has to - or at least scale to a sustainable weight. It's going to, eventually. Just like every other obsolete entity in any industry, it will only survive for as long as it can bully legislators into propping it up.

    Content providers, distributors, they need to catch up.

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