Global content rights are no longer Netflix's (NASDAQ: NFLX) biggest problem, at least in Indonesia: the country's state-run telecommunications provider, Telkom, has blocked the SVOD provider citing objectionable content in its lineup as well as permit issues.
The ban prevents Netflix from reaching a potential 85 million users in Indonesia.
The blockade illustrates the potential for culture clash in many of the new regions in which Netflix has recently launched. Earlier in January, the provider simultaneously became available in 130 more countries around the world, bringing its total to 190 countries in which it has a presence.
And there may be a bit of protectionism at work, too, by incumbent operators: Telkom said that Netflix doesn't have a permit to operate as a content provider in Indonesia, and is violating a 2009 law that requires all films to be approved by a state censor board. Earlier this month, pay-TV operators in the region complained about Netflix streaming violent and adult content, as did the Indonesian Film Censorship Board.
"Netflix's content should adjust to regulations in Indonesia," Telkom VP for corporate communications told The Wall Street Journal in an official statement.
For its part, Netflix said it doesn't have to apply for a permit in the same way as a cable network, telling WSJ that it would comply with all local laws and regulations.
Indonesia is not the only country where Netflix may experience some pushback. "In China, Indonesia, and the Middle East there are going to be all sorts of issues," eMarketer Analyst Paul Verna told Forbes. Content in these regions is routinely censored or banned due to cultural, religious or political issues.
The Indonesian government will decide in February whether or not to continue blocking Netflix. The country previously blocked online video service Vimeo and content site Reddit and hasn't yet lifted those bans.
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