China to Get Netflix Originals in Content Deal With Local Streaming Service

Netflix has signed a licensing deal with a Beijing-based video platform in order to avoid regulatory restrictions and get its content into China's huge entertainment market (via The Hollywood Reporter).

The streaming giant announced the news of its content agreement with iQiyi on Tuesday at the APOS industry conference in Bali, Indonesia.

"China is an important market for obvious reasons; it's also a challenging market for obvious reasons," said Robert Roy, Netflix's vice president of content acquisition. "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," Roy added. "It gets our content distribution into the territory and builds awareness of the Netflix brand and Netflix content."

A subsidiary of Chinese giant Baidu, iQiyi is currently switching from an advertising-supported streaming service to a subscription model in the same vein as Netflix. The subsidiary reportedly commands the largest customer base and content portfolio in China, however it has been looking to broaden its appeal as rivals like Tencent Video and Youku Tudou compete for viewers in the country's market.

It is understood that Netflix will make some of its upcoming original content available on iQiyi at the same time as it appears in other Netflix-serving countries, but further details on which shows would be included in the deal were not forthcoming.

Both Amazon and Netflix have been unable to enter China's market because of regulatory hurdles, although Netflix's House of Cards briefly achieved viral status in China thanks to a deal with local service Sohu. The show was apparently even known to Chinese president Xi Jinping, but it was later withdrawn from local streaming services by regulators.

Last year, Apple faced its own issues with Chinese state regulators regarding a controversial independent movie which led to the shut down of iTunes and iBooks in the country.