Netflix Makes Headway in China with First Licensing Deal

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Thanks to a licensing deal with local video portal company iQiyi, several Netflix original series are set to enter China, the USA -based streaming giant confirmed for TheWrap on Tuesday.

A subsidiary of Chinese giant Baidu, iQiyi is now switching from an advertising-supported streaming service to a subscription model in the same vein as Netflix. The California-based company expanded to 130 countries past year, with China the sole major market not included. But things appear to have changed since past year, as Netflix reportedly struck a licensing deal for China, giving it access to the Asian market.

Popular Netflix shows such as Black Mirror and Stranger Things could potentially be available for viewing by subscribers in China at the same time they are released in the United States, iQiyi said in a statement.

Representatives of iQiyi claim the service has more than 480 million monthly active users, with an above-average growth rate.

The deal comes around six months after Netflix officially put its plans to enter the Chinese market on ice. The iQiyi is at loggerheads with other streaming services in China including Alibaba-owned Youku Tudou and services from Sohu and Tencent.

"Meanwhile, for all cooperation between iQiyi and its overseas partners, we will strictly follow relevant regulations. concerning overseas content", it said.

Outside of China, Netflix still faces some stiff competition in Asia-Pacific from both Amazon-which includes video content with its Prime Video subscription service in some markets-and local players in specific markets. The country had 75 million paid subscribers of online video content in 2016, more than triple the 22 million in 2015, according to a recent report by the Beijing-based research company EntGroup.