With Netflix (NASDAQ: NFLX) poised to introduce their streaming service to China by the end of this year, the company’s stock prices have been soaring. On the tidal wave of the rise, one of Netflix top insiders has sold personal stock, raising $8.7 million, according to 24/7 Wall St. There was no explanation for the sale.
The seller, one of the streaming giant’s company directors, sold 15,128 shares at $573.32 per share, although the stock ended trading Friday at $613.25 per share.
Shares of Netflix were hot on Friday after the announcement that the content-streaming company will go where Google and Twitter cannot: China. The country’s video-streaming market reportedly is estimated to be worth about $5.9 billion, which, according to Investor Place, is $400 million more than Netflix’s full-year 2014 revenue By 11 a.m. Friday, shares were up $29, or 5 percent, to $616 on the NASDAQ floor after the announcement. This marks the first time the video streaming giant has passed the $600 per share mark.
Because operating in China can be a tricky matter for online corporations, as evidenced by Google’s inability to operate in that country, analysts state that Netflix will have little choice except to partner with a Chinese-owned company. They’ll need one that has powerful connections with China’s government and understands that country’s business customs. It’s rumored that Ma, who reportedly has tremendous influence with China’s government, would be a lucrative partner for the video giant.
It’s possible that Netflix plans to enter the China’s streaming-video market by partnering with a Chinese-owned video company associated with Jack Ma, founder of Alibaba. There’s speculation that Wasu Media Holding Co., a Chinese cable company, might be one candidate. Ma owns 20 percent of Wasu Media Holding Co.
Netflix Chief Content Officer Ted Sarandos told Bloomberg that “China is too big to have an asterisk next to it. There are a lot of operating constraints in China that are different to anywhere else. We don’t have any operating partners anywhere else in the world, so that would be a new skill for us too.”
Netflix plans to introduce their streaming service without ads, since Chinese citizens are used to watching ad-free video streaming.
As previously reported by the Inquisitr, Netflix recently entered the Australian market in March of this year, overtaking Foxel in Australia. The company has seen a 64 percent increase in overseas Netflix members in the first quarter of this year and should Netflix successfully enter living rooms in China, there’s no doubt that number will increase.