Netflix hits 1 million users in UK, Ireland: Profit bullet was worth it

Netflix hits 1 million users in UK, Ireland: Profit bullet was worth it

Summary: Internet streaming service Netflix has seen rapid growth in the U.K. and Ireland following its launch in January. The investment in the region has paid off: level 2 unlocked, mainland Europe -- here it comes.

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Television and film streaming service Netflix said today it has reached the 1 million user milestone in the U.K. and Ireland in just seven months; the fastest uptake in users by region ever seen by the company.

The firm was quick to add that it took Twitter four-times longer to reach 1 million subscribers, and Facebook and Foursquare twice as long to reach the million user milestone.

Netflix's success in the region may come as a mixed bag of surprise. With an already strong user base of LoveFilm and iTunes users, Netflix knew it had a difficult task ahead of it. Despite the troubles, the warnings, and the U.K.'s recently entering a double-dip recession -- Ireland's own troubled economy faces further weakening as its membership of the euro zone continues to hit the country -- the media company has done well considering. 

Netflix launched in the U.K. and Ireland in January, by which point Amazon-owned LoveFilm had 2 million users across five European countries, including the U.K., despite Netflix's poorly health and state of affairs by the time it launched in the region.

The media company suffered a profit tumble, and its stock dropped by 35 percent in one day of trading in October last year. With more than 800,000 subscribers leaving the service in one quarter alone, the company was facing hitting the red ahead of its U.K. and Ireland debut.

Though Netflix had a number of high-profile studios and contracts it could flaunt, it was constantly embattled against its arch-rival LoveFilm.

Having said that, Netflix now has by comparison 1 million customers in the U.K. alone and is hell-bent on pushing the business to wider Europe. Nordic customers, including Norway, Denmark, Sweden and Finland, are in Netflix's targets ahead of a mainland European launch. 

Iceland, with a population at roughly one-third of a million users, remains left out in the cold -- literally. 

Now that the U.K. is cracked and unlocked 'level 2,' Netflix can target other major European countries, including France, Germany, and Spain. The U.K. was always going to be the testing ground for Netflix, and despite the firm's own corporate recovery strategy, Europe was always the treasure trove it wanted to unlock.

Ultimately, the answer is "yes," it was worth taking a hit to the chest from the profit bullet to roll out to the U.K. and ultimately mainland Europe. So far, it's paying off nicely.

Its last, lost year was enough to shake the company to its core. Though business school undergraduates will likely examine Netflix's year-long fustercluck for years, the firm has landed back on its feet again -- despite the occasional wobble from Amazon's high-powered side winds.

Topics: Tech Industry, Tablets, United Kingdom

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