Netflix's regional markets south of the United States form a comparatively modest source of income. Yet they certainly boosted the company's financials as it entered the 2020s. Little more than 10 percent of Netflix's revenue came from Latin America in 2021, while the share of the U.S. and Canada surpassed 40 percent. However, growth rates in their neighboring subcontinent indicated its potential for expansion. Netflix's revenue in Latin America in the first three quarters of 2022 was nearly 17 percent higher than in the same period of the previous year. The results of the video streaming service are expected to continue to rise in the region, but not for much longer. Sources estimate that the annual revenue of Netflix in Latin America will peak in 2023 before slowly declining as the decade unfolds, already falling behind 2021 standards by 2026.
Netflix's competitors in Latin America
The company maintains a stable lead in the region's streaming market. In late 2021, it accounted for 30 percent of all household subscriptions to video-on-demand (SVOD) services in Latin America. Netflix subscriptions were forecast to increase even more throughout the 2020s, but two other players were also projected to expand their userbases: Amazon Prime Video and, even more so, Disney+. It is estimated that the number of Disney+ subscribers in Latin America will grow by over 160 percent between 2021 and 2026, which would turn Mickey's empire into a solid second-placed competitor. By 2027, still according to projections, Disney+'s annual revenue in Latin America will amount to about 1.8 billion U.S. dollars – or a 21 percent share of the entire industry. Netflix's forecast revenue of around 3.5 billion dollars will account for little more than 40 percent of the total market.
Latin American demand for Disney+ content
The same product that justifies Netflix's success helps to explain its downward trend in the region: content. Brazil's most in-demand digital original series throughout 2021 were "WandaVision" and "The Mandalorian," both only available on Disney+. The same was true in Latin America's second-largest market, although the ranking of most in-demand digital original series in Mexico included six Disney+ productions and eight by Netflix. But competition goes beyond SVOD, as the ways to access shows and movies are plenty. A study showed that online video piracy is notably common in some Latin American economies, with the penetration rate in Ecuador, Colombia, and Peru surpassing 40 percent in mid-2021.
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