Netflix's penetration rate Japan FY 2023, by age group

According to a survey conducted in Japan during fiscal year 2023, more than 46 percent of people in their twenties used Netflix. While about a third of teenagers used the subscription video-on-demand (SVOD) service, the penetration rate was lower among older age groups.

Netflix’s first steps in the Japanese streaming market

Survey data show that Netflix is one of the leading paid video streaming services in Japan. When the company entered the Japanese market in September 2015, it expected it to be difficult to penetrate due to the brand sensitivity of Japanese consumers. One key strategy for appealing to Japanese audiences was the creation of original local content, which is why Netflix entered contracts with domestic content producers. One of the first prominent titles born from this approach was “The Naked Director” about the life of the adult video director Toru Muranishi, which was published on the service in August 2019. One month after this release, Netflix stated that its subscribers in Japan amounted to about three million. This instance marked the first time that Netflix published figures on the number of its subscribers in Japan.

Strong competition

Next to Netflix, Amazon Prime Video also started offering its services in Japan in September 2015. Although there had been several domestic video-on-demand (VOD) services in Japan prior to this development, such as dTV, U-Next, and Tsutaya TV, the year 2015 marked the beginning of a noticeably higher competition in the market. This is reflected, for instance, by the share of people who use SVOD services, which has multiplied since then. As the market grew, further companies joined the competition, such as Disney and Apple in 2019. A ranking based on user fees shows that Netflix holds the highest market share among SVOD services, but also indicates that the market remains highly competitive.