Netflix Launches Streaming Service in the U.K. and Ireland

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(L-R) Neil Hunt, Chief Product Officer Netflix, Reed Hastings Co-Founder and CEO Netflix, Ted Sarandos, Chief Content Officer Netflix pose during the Netflix UK launch in London, England on January 9, 2012.

It’s official: Netflix is now available in the U.K. and Ireland. The company launched its streaming service on Sunday, a much-needed bit of momentum after dealing with defecting users and plummeting stock prices.

Conquering the U.K., however, will be no easy task. Lovefilm, which already has two million subscribers, wasted no time in cutting its price to £4.99 (about $8); Netflix is charging a monthly fee of £5.99 (about $9) in the U.K. and €6.99 (about $11) in Ireland, which will kick in after users go through their free trial month.

(MORE: Netflix Numbers: 2 Billion Hours of Movies and TV Shows Served in 4Q 2011)

The message to Netflix is clear: Other companies won’t let it waltz into the British or Irish markets and take over. Netflix’s most obvious rival is Lovefilm, a streaming and DVD rental service bought by Amazon a year ago.

Netflix CEO Reed Hastings doesn’t seem fazed over Lovfilm’s move, telling The Telegraph:

We offer a much better user experience than Lovefilm with HD video streams available. We are on more platforms, such as Nintendo Wii and we have a broader content offering.

True, Lovefilm doesn’t stream its content in HD, but it is available via plenty of platforms such as Xbox 360 and Playstation 3, not to mention The Telegraph didn’t seem very impressed with the breadth of Netflix’s offering as compared to Lovefilm’s, a sign that Hastings’ latter two claims might be a bit overblown.

As GigaOM notes, not only does Netflix have to contend with Lovefilm and the Tesco-backed Blinkbox, but also with Rupert Murdoch’s BSkyB, as well as the BBC, which streams episodes of its newest episodes over its iPlayer.

While Netflix has deals with Channel 4, Disney, ITV, Sony and 20th Century Fox, it only has second rights to films from all of the major Hollywood studios, who all have contracts with BSkyB.

So is this a win for Netflix? Its investors certainly think so, with shares gaining 4% after news of the launch. Still, competitors like Amazon and Rupert Murdoch don’t allow for a lot of mistakes; let’s just hope we don’t see a Qwikster U.K. anytime soon.

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