What: Netflix has announced its quarterly results, and they plan to increase their ad spend from US $1.3 billion to $2 billion in 2018.
Why it matters: Netflix is a major global advertiser, particularly in the digital category. The ad spend is producing a positive ROI: "We’re taking marketing spend up a little faster than revenue for this year (from about US $1.3 billion to approximately US $2 billion) because our testing results indicate this is wise, " Netflix Q4 earnings release says.
After a successful 2017, or as Netflix itself announced in its latest earnings release, after a "beautiful Q4", the OTT giant is boosting ad spend in 2018 to hit US $2 billion. "We believe our big investments in content are paying off," Netflix informed to its stakeholders. "Big hits result from a combination of great content and great marketing. We’re taking marketing spend up a little faster than revenue for this year (from about US $1.3 billion to approximately US $2 billion) because our testing results indicate this is wise." Approximately US $8 billion will be spent on original content alone this year.
House of Cards (2013) was the first-ever Netflix original.
Once upon a time, Netflix was virtually the only video streaming provider. Now that new competitors seem to appear every day and formerly partner firms such as Disney and Televisa have decided to move their content to their own platforms, Netflix has decided to stay on top no matter what. With about new 80 original films and 30 anime series, Netflix originals could amount to 50% of their content this year. Even though they have not disclosed their marketing strategy, Netflix is expected to devote most of its budget to digital and especially programmatic. Netflix recommends content to users based on what they watch, a functionality that it sees as built-in marketing for shows.
For the case of slightly older demographic segments, or people who still prefer traditional TV, Netflix has not taken its sight away from them. Most TVs today are "Smart", meaning they have built-in access to Netflix. "[We are] making it super easy for them to sign up by just actually adding Netflix to their bill," said Chief Product Officer Greg Peters, "or even more what we're looking at now is packaging Netflix into one of those operator offerings so they just get it as part of a bundle that they're purchasing for the operator." However, Netflix knows those Smart TVs often also include access to their competitors' platforms (like Hulu, HBOgo, and Amazon), another reason to do their best to stay on top.
Netflix is an Acquired Taste for Latin Americans
In terms of what this means for Latin America, Netflix does not disclose regional numbers. However, we know that they have delivered international content from Mexico, such as Club de Cuervos and The Day I Met El Chapo, or even stand-up comedy shows like the one of successful comedian Sofía Niño de Rivera. They have also produced an Argentinian thriller, Edha, and a Brazilian sci-fi series titled 3%. For 2018, they plan to add more Latin American subscribers than ever with 50 original productions from this region. "A good story told well is a global product", said Ted Sarandos, Chief Content Officer at Netflix.
A good story told well is a global product.
But Netflix was not always well received. When they introduced the website in Latin America in 2011, online streaming was pretty new and they had to compete heavily with traditional pay TV. In 2013, Netflix was the biggest digital advertiser in Latin America. In March that year, they surpassed Procter & Gamble in Mexico with over 463 million ad impressions, and they had about double the amount in Brazil. This number went way up by 2016: According to Portada's 2017 video marketing guide, Netflix had 322 billion Youtube ad impressions in Mexico and 642 billion in Brazil.
Netflix ad impressions and spending in November 2017
|Country||Display Ad Impressions (000)||Display Ad Estimated Spending (000)|
[Source: ComScore Ad Metrix]
María Mercedes used to be one of the telenovelas available on Netflix
Now, Mexico and Brazil are among Netflix's biggest markets, right behind UK and Canada. Though we don't know how many subscribers out of the 6.3 million international users they acquired last year are Latin Americans, analysts believe there are around 5 million subscribers in Brazil alone. And this number might soar if Netflix keeps its promise to include telenovelas in its original content, filling a hole left by Televisa when they moved all their soap operas to Blim (Televisa's OTT platform) in 2016.
Janet has worked as a translator and editor for magazines and publishing houses including Expansion and Grupo Planeta since 2014. She is part of the Portada editorial team, and her main interests include literature, traveling, and exploring new cultures. Follow me on Twitter!
Honduras prison violence: Dozens killed in women’s jail riot
At least 46 women have been killed in a riot at a women’s prison in Honduras on Tuesday.
It is understood that a fight broke out between rival gangs, after which one gang set a cell alight.
Officials say most of those who died were killed in the fire but others were shot, stabbed or beaten to death.
An investigation is under way to determine how the inmates managed to smuggle automatic weapons and machetes into the jail.
President Xiomara Castro, who last year launched a crackdown on gangs, said on social media that she was “shocked by the monstrous murder of women” and would take “drastic measures” in response.
She has dismissed Security Minister Ramón Sabillón and replaced him with the head of the national police force, Gustavo Sánchez.
Survivors of the deadly incident told local media that it was triggered by rivalries between two of Central America’s most notorious criminal organisations: the 18th Street Gang and MS-13.
They said members of one gang had been taunting their rivals, who then set fire to the mattresses in the cell holding those taunting them.
Videos posted on social media showed a huge cloud of grey smoke rising from the women’s prison, which is located about 25km north of the capital, Tegucigalpa, and holds approximately 900 inmates.
While the warring factions are locked up in different parts of the jail, the wings are located close to each other.
The unrest broke out early in the morning local time on Tuesday.
Survivors said that many of those who died had been seeking refuge from the flames in a bathroom. Their burnt bodies were found piled on top of each other.
Others were shot dead and stabbed by gang members in the corridors and a prison courtyard.
Some of the victims are not thought to have been linked to either of the two gangs but were caught up in the incident.
Among them is a former police cadet who was serving a 15-year prison sentence after confessing to killing a fellow police officer.
Another of those killed was only days away from being released after serving her sentence for kidnapping.
Honduras is known for corruption and gang violence, which have infiltrated government institutions and seen the homicide rate soar.
Along with neighbours El Salvador and Guatemala, the country is a major transit route for cocaine coming from South America to the United States.
It also has a history of deadly prison riots, which are often linked to organised crime.
At least 18 people were killed in gang violence at a prison in the northern port city of Tela in 2019.
Colombian plane crash: New clues found in search for lost children
A desperate search for four children who have been missing since their plane crashed in the Colombian jungle on 1 May has yielded new clues.
Items belonging to the siblings, who are aged between 11 months and 13 years, have been found in two different locations in the rainforest.
Their mother and the other adults on board the plane died in the crash.
But search teams say small footprints found last week indicate that the children survived the impact.
The footprints were spotted on Thursday and specialists said most likely belonged to the children.
Earlier last week, search teams had found a child’s drinking bottle, a pair of scissors and a hair tie, as well as what appeared to be a makeshift shelter made from branches and a half-eaten passion fruit.
The children belong to the Huitoto indigenous group and members of their community have expressed the hope that their knowledge of fruits and jungle survival skills will have given them a better chance of surviving the ordeal.
But despite more than 100 soldiers combing the jungle, no further traces were found until the early hours of Wednesday.
The latest items were spotted by an indigenous woman some 500m (1,640ft) from the crash site.
She found a dirty nappy, a green towel and shoes, which judging by their size are thought to belong to the second youngest of the missing siblings, who is four years old. The nappy is believed to have been worn by the 11-month-old baby.
At a separate location, the search team found another nappy, a mobile phone case and a pink cap which matches the drinking bottle found last week.
Indigenous people have joined the search and helicopters have been broadcasting a message from the children’s grandmother recorded in the Huitoto language urging them to stay put and to stop moving so as to make them easier to locate.
The latest traces are further indication that the four siblings survived the plane crash which killed their mother and the plane’s pilot and co-pilot, the Colombian army said.
But it warned that the state of the items suggested that they had not been abandoned there recently, but “sometime between 3 and 8 May”.
The army added that it was encouraged by the fact that none of the items showed traces of blood.
The army colonel in charge of the search also said that all indications were that the four children were roaming the jungle on their own.
Last week, Colombia’s president came under criticism when a tweet published on his account announced that the children had been found.
He erased the tweet the next day saying that the information – which his office had been given by Colombia’s child welfare agency – could not be confirmed.
Pedro I: Emperor’s embalmed heart arrives in Brazil
The embalmed heart of Brazil’s first emperor, Dom Pedro I, has arrived in the capital Brasilia to mark 200 years of independence from Portugal.
The heart, which lies preserved in a flask filled with formaldehyde, was flown on board a military plane from Portugal.
It will be received with military honours before going on public display at the foreign ministry.
The heart will be returned to Portugal after Brazil’s independence day.
Portuguese officials gave the go-ahead for the preserved organ to be moved from the city of Porto for the celebrations of Brazil’s bicentenary.
The organ arrived on a Brazilian air force plane accompanied by the mayor of Porto, Rui Moreira.
Mayor Moreira said it would return to Portugal after having basked “in the admiration of the Brazilian people”.
“The heart will be received like a head of state, it will be treated as if Dom Pedro I was still living amongst us,” Brazil foreign ministry’s chief of protocol Alan Coelho de Séllos said.
There will be a cannon salute, a guard of honour and full military honours.
“The national anthem [will be played] and the independence anthem, which by the way was composed by Dom Pedro I, who as well as an emperor was a good musician in his spare time,” Mr Séllos said.
Dom Pedro was born in 1798 into Portugal’s royal family, which at the time also ruled over Brazil. The family fled to the then-Portuguese colony to evade Napoleon’s invading army.
When Dom Pedro’s father, King John VI, returned to Portugal in 1821, he left the 22-year-old to rule Brazil as regent.
A year later, the young regent defied the Portuguese parliament, which wanted to keep Brazil as a colony, and rejected its demand that he return to his home country.
On 7 September 1822 he issued Brazil’s declaration of independence and was soon after crowned emperor.
He returned to Portugal to fight for his daughter’s right to accede to the Portuguese throne and died aged 35 of tuberculosis.
On his deathbed, the monarch asked that his heart be removed from his body and taken to the city of Porto, where it is kept in an altar in the church of Our Lady of Lapa.
His body was transferred to Brazil in 1972 to mark the 150th anniversary of independence and has been kept in a crypt in São Paulo.
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