Reed Hastings says rise of rivals helps Netflix
The CEO of the video streaming service points to "healthier" relationships with studios as Amazon Prime and Hulu bid for content.
Netflix CEO Reed Hastings insisted today that the rise of rivals Amazon Prime Instant Video and Hulu Plus has actually helped the relationships his video streaming service has with studios.
The competition has led to bidding in the marketplace for programming, allaying studios' fears of Netflix dominance in video streaming.
"One fear they had is that we would run away with the prize.... They don't feel as strategically vulnerable," Hastings said at Morgan Stanley's Technology, Media & Telecom Conference this morning. "It's an overall healthier situation than it was two years ago."
Netflix, which suffered defections and consumer angst a year and a half ago with, has changed the conversation about the company with , "House of Cards." The political thriller from director David Fincher and starring Kevin Spacey is the most streamed content in the United States, according to Netflix.
"We had high expectations and we met those," Hastings said.
But Hastings told analysts and investors that they shouldn't think that success will dramatically alter Netflix's business model. "I don't want you guys to think of us as the 'original content company,'" Hastings said.
Netflix will continue to pursue other original content, such as its horror series "Hemlock Grove." But the bulk of its viewership will remain with content produced for others.
In the 45-minute question-and-answer session, Hastings compared Netflix several times to HBO, saying he hoped his company would evolve into a business similar to the cable giant. HBO primarily shows programming from others, but liberally sprinkles in its own original content. His goal is for Netflix to lead in its market, the way HBO does in cable, while acknowledging that Amazon Prime and Hulu will find their niches as HBO's smaller competitors have done in that market.
"We want to be the HBO of that space and we want them to be smaller," Hastings said.