As DVD stores fade into the sunset, fringe providers grab centre stage
Netflix Inc. is poised to post its first Canadian profit in its short history – just as the last of the country’s national movie chains finishes liquidating its inventory.
Since launching two years ago, the subscription-based service has struggled to break into the mainstream, particularly because of distribution difficulties that have kept many popular releases out of its Canadian library.
But the Los Gatos, Calif.-based company said its Canadian operations will be “sustainably profitable” by the beginning of next quarter, a significant milestone in the country’s slow shift toward non-traditional rental channels. The news comes less than a week after Rogers Communications said it would stop offering movie and game rentals at its retail stores.
“Even with our continued content investment, we anticipate a small contribution profit in Canada [next quarter] and will remain profitable,” the company said. Netflix doesn’t release exact Canadian subscriber information for its $8-a-month service, but said it has doubled its base since the same time last year. It credited its increased programming for the bump, especially a content agreement with the Canadian Broadcasting Corp. that has made shows such as Dragon’s Den and Arctic Air available on demand.