Netflix and other streaming content producers are trying to walk a fine line when expanding overseas, with China high up on the list. However, trying to convince users to spend $7.99 on Netflix Instant, for example, is difficult in China, where Internet users typically pirate content for free. Chinese companies such as Sohu.com are interested in purchasing legitimate content which can then be offered to users in the country in a legal manner, with high-definition content also available.
The Chinese consumer market is huge, as the country reportedly has upwards of 600 million Internet users, according to Pew Research figures released in December 2013. As more users go mobile, Netflix and other content providers have a great chance of convincing users to jump onboard with pay-per-view and monthly subscription packages.
Chinese search engine Baidu and company QVOD were named the top video copyright violators in China last year, with the government reportedly interested in clamping down on some digital piracy.