Netflix CEO Ted Sarandos gave a thoughtful interview to the New York Times published this weekend. In the conversation, Sarandos looked back in his 2012 comment that Netflix was seeking “to become HBO before HBO could become us” and admitted he’d like to take it back — and broaden the original statement to include more programmers.
“At that time, HBO was the gold standard of original programming. What I should have said back then is, We want to be HBO and CBS and BBC and all those different networks around the world that entertain people, and not narrow it to just HBO,” Sarandos explained.
“Prestige elite programming plays a very important role in culture. But it’s very small. It’s a boutique business. And we’re currently programming for about 650 million people around the world,” he added. “We have to have a very broad variety of things that people watch and love. So we take a consumer view of quality.”
Sarandos also looked back at Netflix’s origin as a DVD rental company, sending movies to audiences through the mail — and how they deprioritized that aspect of the business long before many may have expected. He admitted that the company knew 25 years ago that “physical media was not going to be the future,” based on a conversation that he had with Netflix’s former CEO Reed Hastings.
In 1999, Hastings “described the world we live in right now, which is almost all entertainment is going to come into the home on the internet,” Sarandos explained. “And he told me that at a time when literally no entertainment was coming into the home on the internet. And it really helped us navigate this transition from physical to digital, because we just didn’t spend any time trying to protect our DVD business.”
Instead, Netflix leaned into streaming. “At one point, our DVD business was driving all the profit of the business and a lot of the revenue, and we made a conscious decision to stop inviting the DVD employees to the company meeting,” he said. “We were that rigid about where this thing was heading.”
You can read and/or listen to Sarandos’ full interview with the New York Times here.
