Reed Hastings Sees Netflix Joining Forces with Cable Service Providers
March 1, 2012 10:57 AM
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Netflix CEO Reed Hastings
Hastings says it is a long-term goal in order to compete with HBO Go
CEO Reed Hastings said it's likely that the video streaming service will end up doing business with cable service providers in the future, despite being competitors now.
At the Morgan Stanley Technology, Media and Telecom Conference in San Francisco, California, Hastings said that many misconstrue "copycat competition" like Amazon Prime as the main competitors to his service, but mentioned that HBO's Go on-demand service is
the real competition
for his company. For instance, HBO just announced that Go would be on Xbox Live beginning April 1, which will give users an alternative to Netflix.
"It's very easy for companies to over-estimate copycat competition and not see the real threat," said Hastings. "You go back to 1995, and you talk to the Netscape sales force and ask them what their number one competition is, and they'd say Spy Glass, which was taking a little market share from them at the time. But the real competition was Microsoft and bundling."
This is why Hastings sees Netflix eventually joining forces with cable service providers in the future. Instead of focusing on the likes of Amazon Prime, Netflix wants to give cable service providers an alternative to HBO's Go on-demand and hit the real competitor right where it hurts.
"It's not in the short term, but it's the natural direction for us in the long term," said Hastings. "Many [cable service providers] would like to have a competitor to HBO, and they would bid us off of HBO."
Netflix has already began to take HBO on by
releasing original programming
such as "Lilyhammer," which premiered February 6, and "House of Cards," which will debut later in 2012.
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RE: Please don't require cable provider login
3/6/2012 11:22:12 AM
netflix has lost a large chunk of movie library and gained considerable TV library.
i completely agree about commercials. if i'm going to PAY for content, it had better be commercial free. but let's do a little math, shall we?
let's take an old show (relatively speaking), star trek: the next generation. 178 episodes. 45 minutes each. if you were to watch them as originally broadcast, you'd be enduring a full 15 minutes of commercials each episode. that's a grand total of 2670 minutes of commercials, or 44.5 HOURS OF COMMERCIALS. that's right, nearly 2 full days worth of commercials. that's a very significant chunk of MY free time that i don't want to waste watching the same BS ads for cars, oil of olay, or axe deodorant body spray.
now hulu (et. all) does offer REDUCED commercial interruption, but it's still there. if they were to offer only 5 minutes of commercials for a 45 minute show (a 1/3rd reduction) that would still delete 14.8 hours of my time just to sit through crap while watching TNG start to finish.
quite frankly, unless these previously-aired shows from 5+ years ago are in some kind of rerun, they are simply not making money for the content owners--save for sporadic boxed-set sales. bundled licensing to netflix is a great way to derive continued residual income from old shows for virtually NO cost to the content owners. (no production, marketing, advertising, logistics, etc). it's frankly insulting to think that the end user should PAY to watch content, only to be FORCED to endure advertisements.
"So, I think the same thing of the music industry. They can't say that they're losing money, you know what I'm saying. They just probably don't have the same surplus that they had." -- Wu-Tang Clan founder RZA
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