Netflix CEO Reed Hastings gave an in-depth interview with Variety in which he talked about why Netflix’s business model would fit without ads, if the company were to enter games, and the employee who was compensated with $ 100,000 before leaving the company.
In terms of advertising, Hastings said it’s not a hard and fast rule that Netflix wants to avoid ads, but it makes business sense to build the platform on a paid-for-ads model.
“It’s certainly not a rule. It’s a call to judgment … It’s a belief that we can build a better job, more valuable work [without advertising]He said, “You know, ads look easy until you get in. Then you realize that you have to carve this revenue out of other places because the total ad market isn’t growing, and in fact is shrinking now. It’s a hand-to-hand fight to get people to spend less on ABC, you know,” And they spend more on Netflix. “
The consumer market is growing more than the advertising market, Hastings said, and Netflix’s earnings results over the past two decades illustrate this. “We publicly floated 20 years ago at $ 1 a share, and now we are [more than] 500 dollars. So I would say our subscription-focused strategy worked well. But it is basically what we think is the best capitalism, as opposed to the philosophical thing. “
Also in the interview, Hastings was asked if Netflix will be featured on live shows about sports and news. Live news programs probably won’t happen, but Hastings said other categories such as sports and video games may be more realistic.
“I doubt the news, but sports, video games and user generated content – if you think about the other big categories, it might make sense someday,” he said.
It’s not entirely clear here if Hastings is talking about producing TV shows or movies about video games, whether Netflix can get into game development, or something else entirely. Netflix recently released the critically acclaimed documentary on the video game, High Score.
This isn’t the first time Hastings has spoken about video games. In 2019, the CEO said Netflix would not follow the likes of Google, Microsoft, EA and others in creating its game-streaming service. Back in 2011, when the Netflix business was focusing more on rentals by mail, the company announced plans to offer Xbox 360, PS3 and Wii games for rent by mail, but the company abandoned those plans in no time.
In 2018, Netflix partnered with Telltale Games to bring a TV show of your choice to adventure to the platform called Minecraft: Story Mode. Netflix also produced Stranger Things 3: The Game.
Also in the interview, Hastings touched on Netflix’s unique company expense program where employees don’t need to approve their expenses in advance. A Taiwan branch employee paid $ 100,000 for personal vacations, before leaving. Hastings said the $ 100,000 “wasn’t dramatic” in the scheme of things. The unique program aims to help employees feel confident, thus the quality of their work may improve.
You can check out the full interview here at Variety. For more information on Netflix, here’s our report on all the new TV shows and movies on Netflix in September 2020 in the United States.