Netflix has just found a backdoor into China

Photo credit: Tech in Asia

Netflix, which has not entered China, is doing something different instead: it has signed a licensing deal with iQiyi, a popular Chinese video portal, for its Netflix originals shows.

Robert Roy, Netflix’s vice president of content acquisition, announced the deal onstage Tuesday at an industry conference in Indonesia. “China is an important market for obvious reasons; it’s also a challenging market for obvious reasons,” said Roy, according to the Hollywood Reporter. “Right now what we will do is look to license content into China. We closed a deal with iQiyi, which is exciting.”

“For us, it does a couple of things. It gets our content distribution into the territory and builds awareness of the Netflix brand and Netflix content.”

iQiyi is a spin-off from Baidu, China’s top search engine. The portal’s main rival is Alibaba-owned Youku.

“We are going to announce details in the near future,” an iQiyi spokesperson tells Tech in Asia (Updated one hour after publishing: added in this response; and updated next day: iQiyi has confirmed the deal but not announced any financial details. Black Mirror and BoJack Horseman are among the first batch of Netflix Originals going to China).

One more barrier

Netflix is locked out of a solo entry to the Chinese market by protectionist policies on overseas media. Roy told the Hollywood Reporter that the US$63 billion company, which recently topped 100 million global subscribers, is still “trying to figure out over time” how to tackle the Chinese market on its own.

Netflix produces an array of acclaimed original dramas, such as House of Cards and Orange Is The New Black, as well as popular comedies like Master of None and BoJack Horseman.

BoJack Horseman has become a cult hit among China’s younger web users despite it not being broadcast in the country. Its animated anti-hero is frequently memed in translated screenshots.

Even with the licensing deal, a further barrier remains. All oversease TV shows need individual approval for streaming in China – as do movies – and there’s a strict quota so as to boost the local TV industry and minimize foreign influence on youngsters.