China’s modern digital regulation is as imposing to tech giants as its Great Wall once was to invaders. The censorship and blocking of Western tech icons like Google and Facebook inside the world’s most highly populated nation shows few signs of ebbing. Netflix also finds itself on the outside looking in, despite its natural desire to add a couple billion new streaming customers to its fold.
But Beijing says no thanks: we don’t need Ryan Gosling streaming into people’s Shanghai homes, let alone Matthew McConaughey rom-coms. Could get dangerous. So Netflix must wait. Yet Netflix is still working to build relationships in China — relationships that actually work commercially even if they aren’t nearly as beneficial as its normal operations. Stymied at running its streaming service as a standalone, Netflix is relegated to licensing content to local Chinese companies who resell it there. The setup is not as profitable, of course, but it allows Netflix to begin to extend its commercial reach and get its content known. Netflix will bide its time and focus on its booming growth elsewhere.
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