Netflix is talking to Jack Ma-backed Wasu Media and others about partnering so it can enter the Chinese market, according to Bloomberg. Fred Katayama reports.
Red could be the next black for Netflix, and it's talking to Jack Ma's affiliate about it. Bloomberg reports that the video streaming company is in talks with Wasu Media and others about teaming up so it can enter the Chinese market. Wasu is backed by Alibaba founder Jack Ma, and Bloomberg says Netflix seeks a partner that would enable it to stream its content across all devices. Netflix didn't immediately respond to a request for comment. Its CEO Reed Hastings told Reuters last month he's thinking about what he called a "modest" service in China, and that he's pursuing a subscription-based service. That's a departure in a country where consumers are used to watching entertainment for free that's supported by ads or illegally pirated. He said Netflix was exploring its options in China by talking to U.S. and Chinese companies. Bloomberg says Netflix would need a local partner in light of Beijing's strict controls over licensing for online content, and Wasu is one of seven companies that has an Internet TV license. One challenge Netflix could face is censorship. Foreign TV shows have to be approved before they can be aired or streamed in China. Sterne Agee senior analyst Arvind Bhatia said, "I imagine they'll have to tweak their content somewhat, making sure local laws are adhered to. Having a partner will help them take care of that." Netflix shares adding on to its 72 percent gain this year at the open. Wasu shares fell slightly.