Netflix officially launched in Australia a decade ago. But that isn’t when Australia began its relationship with Netflix.
Just as Australia over-performs in areas like sport and science globally, back in the early 2010s we punched above our population weight and led the world in global TV show pirating and setting up dodgy international Netflix accounts. When Netflix officially opened its doors down under on 24 March 2015, many of us were already very familiar with the streaming service.
The launch was two years after Netflix launched its first original series, House of Cards (seen locally on Foxtel, a couple of months after the Netflix premiere), along with Netflix originals like Orange is the New Black, Unbreakable Kimmy Schmidt, Hemlock Grove and Marco Polo.
Hands up anyone who remembers Marco Polo?
In the decade that followed the launch of Netflix in Australia, the local TV industry has been radically reshaped, with more dramatic changes to come over the coming years. While many of these changes can’t be attributed entirely to Netflix’s presence in Australia, the arrival of Netflix sparked a series of changes that opened the door to new media companies competing with traditional TV channels and shifted viewers’ behaviour.
After all, Netflix got viewers to do the one thing that Foxtel always had trouble doing in Australia: it convinced us to start paying for television.
TV is very different now
According to Acma, the number of adults watching free-to-air free-to-air TV has declined from 71% in 2017 to 46% last year. Meanwhile, video streaming subscription streaming service use by adults has increased from 29% in 2017 to 69% in 2024.
With more than 6.2 million Netflix subscribers in Australia alone (including paid and unpaid users), it is evident that streaming services are having an impact on traditional TV viewership.
Back in 2015, when Netflix first launched, local media executives like Shaun James from short-lived streaming service Presto (a joint venture owned by Foxtel and Seven) and then-Stan chief Mike Sneesby would tell media that they didn’t see their streaming video products as cannibalising broadcast TV, but rather as an additive – claiming most viewers weren’t streaming until after 9pm.
Media reporters were sceptical then and you certainly don’t hear current executives try to make similar claims now.
A willingness to pay
It is a fallacy to suggest that in the past we weren’t paying for content. Without a second thought we were buying newspapers and magazines, renting out DVDs and VHS tapes, buying CDs and records and all sorts of other physical media. But outside of buying the occasional TV show DVD boxset or the third of Australians who were paying for Foxtel at its peak, Australians weren’t comfortable with paying for TV.
Since the launch of Netflix, that has changed. In addition to the ever-escalating price of a monthly Netflix subscription, Australians are now paying money each month for multiple streaming services. In its annual subscription entertainment study, analytics firm Telsyte reported an increase of year-on-year subscribers for all but one of the major streaming services in Australia.
This has flow-on effects. It limits access to quality content for viewers who either cannot afford to pay for streaming services or have trouble with the technology. This disproportionately impacts older Australians.
But then there is also the issue of sport. In Australia major sporting rights are protected by anti-siphoning legislation. Major sporting events and games are first offered to free-to-air broadcasters, but increasingly we are seeing shared deals between networks and pay companies which put sport behind paywalls. The legislation also isn’t keeping up with shifting interests, with women’s sport like the AFLW not protected by the anti-siphoning legislation.
Pay services are seeing opportunities here. Foxtel launched sport streamer Kayo. Stan now has Stan Sports, which is available for an added fee. Paramount+ and Prime Video are both streaming sport regularly. And Disney+ will launch an ESPN section on its service on 26 March. Australia will be the first English-language market outside the US to add ESPN, with Disney openly saying it may be interested in pursuing sport rights.
Becoming HBO
Back in 2013, Netflix exec Ted Sarandos said in an interview with GQ that the goal for Netflix “is to become HBO faster than HBO can become us”. He was expressing the desire to make Netflix into a premium TV destination that could attract top talent working with budgets that offer creative freedoms. Since then, Sarandos has retracted that sentiment.
In an interview with the New York Times last year, Sarandos expanded out this idea to include the likes of CBS and the BBC. His view now is that they want a broader range of quality TV that extends beyond what we consider to be prestige dramas and comedies, to also include reality shows, documentaries, sport, stand-up comedy and more.
There’s an interesting symmetry to the fact that just one week after Netflix marks 10 years in Australia, Warner Brothers Discovery is launching the new streaming service Max, which includes all of HBO’s programming. The focus of Max is on HBO’s prestige dramas and comedies but also includes reality shows, documentaries, stand-up comedy and more.
With Netflix having already become HBO and moved on to a wider audience, it’s interesting to now see Max struggling to catch up to become Netflix.
Looking ahead
What does the next 10 years look like? Netflix opened a doorway for every major US studio and entertainment company to launch their own streaming services and go direct to consumer. The impact of that in international territories like Australia is that local streaming services, reliant on that pipeline of US and other global content, have been squeezed.
If you are Stan, Binge, SBS on Demand or any other local player, it is now more expensive to buy the remaining content that isn’t already exclusive to one of the other streamers. This past year Foxtel (which controls Binge) lost content deals with the BBC and HBO. ESPN’s future at Foxtel remains a question mark for the moment. And it’s looking down the barrel of a rights deal set to expire with NBCUniversal, which Stan – also facing similar content access concerns – will no doubt make an aggressive play for.
As further contraction in the industry sets in, it is difficult to see a pathway forward for either Foxtel/Binge or Stan without a major strategy change. Foxtel will likely pivot in the direction of sport under new owner Dazn, a European sports broadcaster. But even sport doesn’t provide much cover with the internationally owned streamers all flirting with Australian sport rights deals that offer the promise of large-scale international distribution.
Beyond it all is Netflix, which has seen profitability in recent years and a customer base that still has growth, and is making successful forays into live entertainment focused around sport and variety entertainment.
A decade in, the impact of Netflix launching in Australia has been the dramatic decline in traditional TV viewership, Foxtel in retreat and hungry international competitors baying for sport rights. The industry that now exists outside of Netflix’s paywalled gates is as structurally safe as a house of cards.
