A new report estimates that despite intensifying competition and the possibility of subscriber saturation, Netflix (NASDAQ: NFLX) will have more than 175 million subscribers within four years -- more than double its current worldwide subscribership of 75 million. And the vast majority of that growth will still be in the United States.

"This growth will be fueled by aggressive international expansion of its streaming service, increasing broadband penetration, and a growing library of content that caters to different audiences across the world," said James Wang, an analyst with ARK Investment Management.

Netflix will have a penetration rate in the U.S. of 63 percent, while the rest of the world will have just 18 percent penetration, the firm said.

ARK based its estimate on a number of factors: the number of current broadband subscribers worldwide, the 2014 gross domestic product (GDP) per capita of a wide cross-section of countries, and overall interest in Netflix as of November 2015. The research firm then multiplied its estimate of Netflix's penetration worldwide by 2020 with the estimated number of broadband subscribers worldwide by 2020 to come up with its results.

The countries with the biggest subscriber numbers by 2020? That would be the U.S. -- which isn't necessarily surprising because it already has far and away the largest subscriber base at 45 million -- and China, which ARK estimates will have 12 million Netflix subs by 2020 despite a broadband penetration rate of just 4 percent by that time.

Ark's forecast may be somewhat sunny -- for instance, Netflix has yet to even launch in China, and for the moment it can't do so independently. Foreign companies are not allowed to operate in the country unless they are partnered with an existing Chinese company. Take ESPN, for instance: the sports network, which is building a fairly strong online streaming presence, recently began streaming live sports in China, with Mandarin-speaking announcers -- but only through existing OTT provider Tencent. "Navigating China's stringent regulatory environment will be challenging," Wang said.

Other countries included in the firm's estimates did not have a Netflix presence at the time the study was conducted. For example, the SVOD provider had not launched in Poland or the Phillippines in December (Netflix later rolled out to these countries and 188 more in early January), but ARK noted that interest in the service was very high in both countries.

And the report didn't take into account the effect of competition on those subscriber numbers, though Wang noted that it could put a damper on Netflix's growth.

"Content wise, it must continue to improve its offering, especially in the face of fierce and well funded competitors such as HBO, Amazon, and various local operators. All that said, the road to 2020 may prove to be Netflix's golden years," Wang said.

For more:

- see this CED article

- see this ARK Invest post

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