China Remains Roadblock to Netflix's Global Expansion Ambitions

Netflix’s massive expansion of its online movie streaming service to cover 130 countries and territories has one glaring absence: China. Strict controls over content and the need for a local partner to meet licensing restrictions are standing in its way. That’s prompting talks with the nation’s largest Internet companies, including an affiliate of Alibaba Group Holding, to clear the way for an expansion into a country with more web users than any other. Netflix wants to become the first global online TV service, with its latest expansion adding countries including India and Russia for movies and its own content, including the critically-acclaimed of “House of Cards.” While mainland China offers an online video market estimated to reach about $14 billion within three years, content rules are strict and Internet giants Alibaba, Tencent Holdings and Baidu offer their own services. When asked why any of China’s three biggest Web operators would be a partner given their competing services, Chief Executive Officer Reed Hastings said Netflix was in talks with the companies and the government.