Globalization Drivers and Market Entry Strategies of Netflix in India and UK

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Critical Issues in Business Management
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Introduction
Initially, Netflix was a publicly-traded organization that was involved in offering
subscription video streaming as well as online digital disc, including Blu-ray Disc rental
services. All these were offered at a constant fee of US$ 7.99 monthly. By January 2016, the
organization had a revenue estimate of 74 million subscribers globally. The subscribers ranged
from those in the United States, - its domestic market- to customers in other parts of the world
such as South Korea and Poland. By 2015, the firm had approximately 3,500 full-time staff and
recorded revenues of approximately $6.78 billion. The company’s 2016 plans were to expand the
firm by targeting a global market. Netflix’s status as a power to reckon with in the internet
streaming industry was conceived from relatively humble beginnings. The company was
established to provide a solution to the common, but irritating issues of overdue fees related to
movie rentals. The company was founded in 1997 by Marc Randolph, - an entrepreneur- and
CEO Hastings. The report’s main objective is to provide an analysis of how the company’s
growth strategies were influenced by the drivers of globalization and offer a comparison of the
market entry strategies of Netflix in India and the UK. Besides, the report will also examine the
company’s opportunities to expand in another Asian market and the sustainable approach that it
can adapt when expanding into the Asian market.
Drivers of Globalization
The media, as well as other books on globalization, classify the drivers of globalization
into five groups which include technological, political, market, cost, and competitive drivers.

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Technological Drivers
Modern globalization has been shaped by technology. One such technology is the video
streaming technology that is used in delivering videos over the internet, and which is used by
Netflix. Using this technology, the company has been in a position to deliver audio as well as
video through the internet to its different subscribers globally through their PDAs, computers,
smartphones, along with other video streaming devices (Kim, 2016, pp.162). Netflix’s growth
strategy has been influenced by technological drivers, particularly those linked to the video
streaming technology. For instance, the employment of efficient and high-speed broadband
networks has influenced the growth of the organization (Brennan, 2019). Also, more efficient
video and audio compression methods have been developed. Besides, in recent times, there has
been an increase in audio and video quality and a variety of services. These, accompanied by
other technologies, have influenced the growth strategy of Netflix.
Market Drivers
There has been saturation in the domestic market, making opportunities for growth
unlimited. As a result, expanding globally is one of many methods that companies are choosing
in overcoming the situation. Besides, the existence of common customer needs as well as the
opportunity of using global marketing channels along with the ability to transfer marketing to a
certain level is also an incentive to select internationalization (Hagiu, 2019). Netflix’s market,
the US is almost coming to saturation, hence the company has sought to expand to other markets
such as India, thus affecting its growth strategy.

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Cost Drivers
The cost, as well as efficiency, does vary within states and international organizations can
advantage of this fact. Cost drivers to globalization such as the availability of opportunities for
building international scale economies along with high costs associated with developing a
product have influenced the growth strategy of Netflix.
Competitive Drivers
Due to the global market, there has been an increase in inter-firm competition, forcing
companies such as Netflix to go international. For instance, the company faces stiff competition
from firms such as Amazon and Baidu, forcing it to globalize its operations (Walker, et al., 2017,
pp.16). The competitive driver is supported by strong interdependence among states, the FDI
actions as well as two-way trades.
Political Drivers
Deregulated markets along with liberalized trading rules result in reduced tariffs. Besides,
a foreign direct investment that is generally accepted in all countries globally helps shape
globalization. Direct investment and liberalized trading rules have facilitated the growth of
Netflix’s growth strategy because it has been able to offer services in more than 190 countries
since 2016 (Khanna, 2017, pp.89). This, as a result, has supported its growth strategy.
Customers Demand
The demand for online content has increasingly increased over the last decade across the
globe, and India is no exception. Depending on the nature of the consumers in populous
economies such as India and China, the level of consuming online content does vary. According