CEO Reed Hastings compares his company to HBO
Netflix founder and CEO Reed Hastings said he berates himself heartily for splitting off the DVD business prematurely, but he emphasized that the company is moving on after being hammered for months about its fumbles.
Hastings told the crowd at the UBS Global Media and Communications confab on Tuesday that he expects substantial subscriber growth next year.
“In three to five years all people will care about is did we succeed. We are not losing too much sleep over that” anymore, Hastings told a packed ballroom full of investors.
Hastings surprised the crowd by saying he sees HBO Go as his company’s biggest rival. He also predicted Internet viewing of TV will rising dramatically (to 50% of the total in five to ten years); and that Netflix ultimately will “create a library of the worlds best content for the world’s citizens.”
HBO Go is “kind of in a gilded cage, not competing directly with us, but they can. HBO is becoming more Netflix-like and we are becoming more HBO-like” with investments in original content like David Fincher-Kevin Spacey drama series “House of Cards,” Hastings said.
“I think the two of us will compete for a very long time,” he said. “Many people will subscribe to both. We’ll always be a little better on the Internet; they will be a little better on originals. We will try to catch up to them on that. Like two brothers pushing each other.”
Amazon and Hulu are the companies more often mentioned as Netflix rivals. “There will be a lot of competitors out there. But HBO and Netflix each spend $1 billion to $2 billion a year on content,” he said. “If you’re not willing to invest at those levels, it’s hard to compete.”
Hastings, who also sits on the boards of Facebook and Microsoft, said he’s happy with Netflix’s international rollout so far but reiterated that additional expansion plans are on hold until a return to “global profitability.”
However, down the road he sees the potential to create a really global company with a library of superb content — tapping anime studios, telenovelas producers, the BBC. “The Internet is the first time there has been a global distribution medium,” he said.