Photo Credit: CC-By-Yaneev Avital
 

After establishing a presence in Britain and Ireland, Netflix (NFLX) entered the VOD market in the Nordics in 2012, setting up offices in Denmark, Finland, Norway, Sweden, and the Netherlands. Though critics cast a gloomy outlook on Netflix’s 2012 expansions, it didn’t seem to faze the video-streaming giant. Netflix has a clear vision for their future, and the future of Television, and they’re not letting anyone stand in their way.

This year Netflix will invest $400 million to expand it’s reach into Germany, Austria, Switzerland, France, Belgium, and Luxembourg. Though many of these countries already have established video and TV streaming companies, Netflix feels that it can offer up a different flavor to the on-demand market and stands to make a significant profit. The company could be spot-on in its forecast, if history tells us anything. Profit predictions for the 2012 expansion into the Nordics were dismal, even from Netflix. At the end of its third quarter, the company predicted a loss with estimates expecting a $0.13 per share loss—but instead, the streaming king had a $0.13 per share gain with total Q4 revenue reaching $945 million.

The presence of Netflix, which currently boasts over 50 million subscribers in 40 countries, is welcome in most European countries. However, that doesn’t seem to be the case in France. Though the company declined to comment on the challenges it faces in France before the official launch today, it appears to be encountering signs that its presence might not be so welcome.

Why the bitter welcome in France?

Canal+ is France’s main pay-TV operator, and currently has half a million subscribers for its CanalPlay, which it started in 2011. Last Wednesday the company made a move to head-off competition coming from Netflix’s impending entry into the French VOD market by launching a new partnership with HBO as well as the possibility to download series and movies to watch later without an internet connection. Canal+ already owns French rights to “House of Cards.”

Patrick Holzman, CanalPlay’s director, is relying on the company’s “French touch” and its relationship with customers to provide the edge in the upcoming battle for subscribers: “Our strategy is the same, with or without Netflix,” said Holzman.

Among other regulation challenges faced in France is a requirement that, designed to protect domestic creativity, 40 percent of content must be of French in origin. This applies to French radio, TV and movies aired in theaters. However, Netflix doesn’t have to comply with the rule because their European headquarters are conveniently located in Amsterdam.

Though Netflix will not be obligated to comply with the French content requirements, in what could be considered a cultural gesture of détente, they have planned to produce an eight-episode television drama series called “Marseille,” set to start in late 2015, written by French award-winning writer Dan Frank.

But for some in the French cinema community, the bone Netflix is throwing isn’t quite enough.

“We welcome the competition,” said Pascal Rogard, director of France’s Society of Dramatic Authors and Composers, “but only if they’re playing with the same rules.”

Many with a vested interest in the film industry in France fear that the wave Netflix is making while playing by their own rules will overtly disrupt Canal+’s subscriber base. This could be problematic given the fact that the company is currently the main financier of French-made films.

“There is a particularity in France in that television channels finance domestic productions. Their level of investment is calculated according to the number of subscribers,” Florence Gastaud, head of a union of French producers and authors, explained. “Therefore if the number of subscribers goes down (as some move to a Netflix subscription), the investment in domestic production goes down.”

However, all the fuss doesn’t seem to deter Netflix on their quest to become the global leader in VOD. Though only time will tell, the company has made it clear in both words and actions that their vision is to be the leader in video-streaming services, worldwide.

Netflix quotes in their long term view on their website, “We strive to win more of our members’ “moments of truth”. Those decision points are, say, at 7:15 pm when a member wants to relax, enjoy a shared experience with friends and family, or is bored.  They could play a video game, surf the web, read a magazine, channel surf their MVPD/DVR system, buy a pay-per-view movie, put on a DVD, turn on Hulu, or they could launch Netflix. We want our members to choose Netflix in these moments of truth.”

Will the French choose Netflix in their next “moment of truth”, is the question?