Netflix

“Netflix itself has the fourth largest production budget in the USA.”

“DVDs was a hundred percent of our revenue, and the, we had a whole, like, giant team running that business, and one day I said, you guys aren't allowed to come to staff meeting anymore.”

“I think we're almost 10% of their signups at one point.”

“What we're trying to do is tell these stories that are authentically local, and the win for us is that they actually travel more the more authentic they are. Because there's something inorganic about the English language European television show that forces it…”

“I knew as soon as we heard the Stranger Things pitch that we were doing the show. And I knew at every step of the way, as the episodes, as the scripts were coming in, as the episodes were coming in, that it was something special. Not at the scale that it is. I…”

“The people who work for me in LA, there's about a thousand people who work in LA that, on all the aspects of content they all think they work at the greatest entertainment company in the world. And I hope they, I think they're right. And I think there's about …”

“This year we'll have 30 original series, 80 original films, 35 original kid series 19 local language original series being produced all over the world 65 documentary projects, so I would say it's about one in a hundred.”

“Everybody at Netflix back in those days had a scale on their desk. Because everyone was trying to optimize for postal weight.”

“And you show, show like the three percent, which is a show we make in Brazil, in all in Portuguese, with an all Brazilian cast, and the watching on Netflix in the U.S. Would be equivalent to a pretty good sized cable hit.”

“House of Cards was our first original show on Netflix. And The deal we made with David Fincher was, I'm gonna give you two seasons of the show, no pilot, and no notes.”

“We didn't, we spent almost no marketing money on the show at all. And it just exploded on its own. So, nobody could, I mean, nobody inside of Netflix foresaw that was going to be, you know, an overnight sensation like that, like it was.”

“As soon as Netflix hit thirty million paying subscribers in the U.S., they started expanding everywhere, because the population of the U.S. Is three hundred million.”

“You're worth 2000 dollars or more to Geico if you're a relatively good driver, you're worth a hundred dollars to Netflix, you're worth hundreds of dollars to the cell phone carriers, and these companies will pay some percentage of this to whoever refers you to…”

“Netflix and Amazon are now top tier content producers. They have equivalent budgets to the other major US entertainment companies.”

“Watching people play games is now bigger than Netflix, or bigger than HBO, or bigger than ESPN.”

“I think more than 60% of streaming hours on Netflix are coming from the major game consoles.”

“The hits are really starting to drive, I think, Netflix's business, which is why they realized that, They can spend a hundred million dollars to actually fund a total of 26 episodes across two seasons for House of Cards. Actually, it's probably much more than …”

“There's always this sort of misperception that you can turn up with technology and disrupt it, but actually the point of Netflix and the reason why the existing model is so strong is it's actually, no, it's the content. That's the lock on all of this stuff, an…”

“Netflix is kind of a cable channel. Now, this is in the content business that happens to use technology to do interesting and new and disruptive ways to things.”

“There was two metrics at Netflix that every product manager was geared toward. It's subscriber retention and streaming hours. The most highly correlated variable to subscriber attention was streaming hours, right?”

“The open source components that, that make up a large part of the DCOS are used by a large number of companies today. Some of the biggest users out there are companies like Twitter Airbnb, HubSpot, eBay, and PayPal are using it for running things. Netflix is u…”

“I think people are used to curating their lives a little bit more with DVR and Netflix. They're used to, like, programming their own entertainment, and podcasting doesn't seem like that big of a deal anymore.”

“Netflix, they have this chaos monkey suite of tools where the tool will periodically take subsystems out of commission and see how the overall system responds live. It'll just kind of knock out portions of Netflix and see how it responds. And the idea is to lo…”

“We started off basically running away from a monolith. We had over a hundred people every two weeks trying to get all the code they'd written in the last two weeks jammed into one code base, get it through QA and get that out into production.”

“So what you're seeing now is Twitter and Facebook and Netflix and Google and LinkedIn producing the stuff you actually want to use, which has already been tested at volume. And then it's actually much harder to build a proprietary software company because you'…”

“You could not start Netflix of the art today because there's no back catalog to license every, every, you know, Netflix starts and they license a hundred something years of cinema and television and they have a catalog. Got it. And you pay for it, access that …”

“Initially where you know when you have sites like Steam and you know, Oculus site and all these will be the first places that you're able to sort of download, but I can see very clearly a time when you will have this sort of Netflix like library to choose from…”

“I think the big breakthrough will come with biometric data. So far, most of these algorithms, whether it's Amazon or Netflix or whatever, they work mainly on the basis of data external to my body. They follow me around in space, see where I go, which places I …”

“It's already working on some level because you might have a million other movies out there, but you really don't care because you only care about what's in the Netflix catalog because you're Being able to binge watch and get it on demand in the moment. So it's…”

“Jeff Bucus, who runs Time Warner, who's, you know, Stanford MBA, he's been in the business, ran HBO for 20 years, you know, a very thoughtful guy, and yet he missed the Netflix thing. And what happens to people is they associate you as you are, not as what you…”

“It's not just competing against Amazon or HBO, it's really this open competition for time.”

“And so that's when I vowed that in starting another company, that at least we wouldn't make that mistake. That as we grew, we would try to have less rules, not more rules.”

“In his first two years at Netflix, he had to work out of the home because he couldn't afford an office, and he used to drive down with his crew to Costco and, you know, buy 5000 copies, and, you know, we would load them up and mail them out.”

“Yeah, the first weekend, well, it was all the press leading up to House of Cards, and then the first weekend, and then there was the White House Correspondent Center that year spoofed it, and we had clearly hit a meme that we thought, wow, if we can do more of…”

“If you look at the total global ecosystem, we're still sub-five percent of all content being made around the world.”

“We stopped advertising on linear TV a couple years ago, and all of our advertising is online, because we want to target the show to the person”

“Then we did our first test in Canada, our first test of streaming only, so we picked a new country that wasn't used to our DVD service to see with the content that we can get, can you build a service that there's word of mouth and grows in a, in another countr…”

“And if we can combine the two of them better, that protects us against HBO, which is very good at content, but not so good at tech.”

“So we always viewed the DVD by mail as a digital distribution network, And then we knew eventually, and that's why we called the company Netflix and not DVD by mail or, you know, that kind of thing. So we had the slight advantage that the thing that we, our fi…”

“We were hybridizing it with streaming, and we were getting more streaming attention and executives, but the discussion was still a lot around DVDs, and then we realized that we had to kick out the DVD executives of the main management meeting.”

“Now, for this calendar year, we're spending about five billion on content and one billion on tech.”

“By 2011, 20 12, we were realizing that many of the firms that we were buying from were eventually going to want to run their own streaming service, and that we had, we did not have a reliable supply, and so there's a bit of the burn your boats Cortez model, wh…”

“In Amazon's case, I would say they've exceeded the amount of investment that I would have thought they'd, ah, put in. They spend a tremendous amount of money in the area, and some of the shows, as you said, are working out.”

“So do we need to buy a telco? No, because we're not trying to, you know, we work with over 500 ISPs around the world. Ok, so just like Facebook, or Google, or anyone, or an internet company, the last thing, I mean, you know, how well is Google Fiber worked out…”

“You know, you're in for the whole thing at, you know, thirty million to a hundred million dollars. So the size bets that you have to make on these are larger.”

“For a non-tech company to do a little bit of tech on the side, that will never work out. But if they must get good at that area, and they're a good management team, and they put, say, a third of the company to it, they can figure it out, including on the creat…”

“The key thing is not getting into the new business. Lots of companies do that. They just don't get in and make money. They don't create it as a profit driver, They get in and dabble with it and lose money in it, essentially”

“In the middle of the blockbuster wars, we started buying films on DVD out of Sundance, and we couldn't make the economics work. We bought a whole bunch of films, and it turned out we just spent a lot more money than we got.”

“Our commercial proposition, the two services, had to be highly integrated in the beginning. Because we just didn't have enough content. A combination of money to license that content and studio comfort.”

“There's about a thousand people who work in LA that, on all the aspects of content, they all think they work at the greatest entertainment company in the world. And there's about 4000 people in Silicon Valley who think they work for the best tech company in th…”

“We didn't, we spent almost no marketing money on the show at all, and it just exploded on its own. Nobody inside of Netflix foresaw that was going to be, you know, an overnight sensation like that, like it was.”

“What we're trying to do is tell these stories that are authentically local, and the win for us is that they actually travel more the more authentic they are. Because there's something inorganic about the English language European television show that forces it…”

“You show a show like the three percent, which is a show we make in Brazil, in all in Portuguese, with an all Brazilian cast, and the watching on Netflix in the U.S. Would be equivalent to a pretty good sized cable hit.”

“This year we'll have 30 original series, 80 original films, 35 original kids series, 19 local language original series being produced all over the world 65 documentary projects, so I would say it's about one in a hundred.”

“When we've made a move into original programming, We were so convinced as a company that we would never do original programming that Reed had said, we'll never do original programming, yet I knew that I was in a safe place to do it.”

“That we had a 100,000 titles on DVD, and every day, 60,000 of them shipped.”

“The ones that don't ultimately realize those audience, or that, that audience, and one of those was Crouching Tiger, Hidden Dragon II, our first big movie we put out. We thought it was going to be, The second coming.”

“Today's episode features a Q&A with Ted Sarandos, chief content officer at Netflix, which evolved from a company that sold DVDs by mail to streaming to including original programming, which is now an over seven billion dollar investment for them.”

“The cumulative buzz of Orange is the New Black, the cumulative buzz of 13 Reasons Why, the cumulative buzz of Stranger Things is actually much bigger than Game of Thrones.”

“There's probably 600 meaningful ones, yeah.”

“I also think Netflix, even beyond that, it's catalyzing the most dramatic period of revolution and change in the television video industry. You know, certainly since the arrival of color TV and maybe, maybe even before that.”

“Peter Morgan writes every word of the crown. No, no writer's room. He has some research team that helps him, but every word of that show is written by him”

“And it was the biggest launch of all four.”

“African-American superhero, and on and on and on, and it was hugely popular for us all over the world.”

“House of Cards was our first original show on Netflix, and the deal we made with David Fincher was, I'm going to give you two seasons of the show, no pilot.”

“I knew as soon as we heard the Stranger Things pitch that we were doing this show. And I knew it every step of the way as the episodes, as the scripts were coming in, as the episodes were coming in, That it was something special. Not at the scale that it is. I…”

“I think it's underrated relative to watching, and some of our top watched movies have been these Sandler movies, which tells you, again, what people's tastes are.”

“Where we see we have a failure is that relative to what it costs, did enough people watch it that it was a good use of content dollars. So there is an efficiency measure in that way, which is, is it an efficient use of dollars relative to any other way you wou…”

“Iron Fist is literally the worst reviewed show on Netflix.”

“At an enterprise level, you know, 99.9, they're still monolithic, so it's more a 10 years transition that we'll see, and what Netflix did, it will happen to Coca-Cola, to McDonald's, so there's a lot of value to be unlocked and to help companies doing this tra…”

“When Netflix increases their monthly subscription by two dollars, everyone's, you know, screaming bloody murder. And B to B is obviously less elastic.”

“There is no library to buy for this very high quality short form content. So unlike Netflix or Hulu or other that bought a library, there is no library to buy. So we have to commission that content.”

“It really is in the last, like, three years, it feels like a bunch of the Valley companies are really starting to decode culture, A bunch of the big, I mean, Netflix being, you know, Netflix sort of, you know, sort of setting a new model, but now being, you kn…”

“It's much harder to make those mid, mid, those sort of mid budget, 14 to 25 or thirty million dollar movies. Though Netflix does it, right? You can do it at Netflix now, which is probably where it would happen, but, and then, or you would try to tell the story…”

“Like, the idea for Netflix is, my job is to make shows that make people want to Subscribe to Netflix, which is very different than keeping people watching, you know what I mean, it's just different bringing people to the show for a specific hour of time.”

“We've really created, we were able to create a model in the beginning when we first got there to find a way to hold on to a series of our writers and to make it sort of a creative home for people to stay versus you know, you have to go away and take a deal her…”

“I can tell you exactly in specific terms what they ask from us, which is make whatever makes you happy, which has been fantastic.”

“But it's never been a thing that I've really paid attention to in a real way in network television because testing in network television is really about opinion. I'm very excited about it at a place like Netflix because that, the data is very different than te…”

“We don't have to ask those questions. Like, that's not a thing that happens. It's more about, are you excited about this?”

“You might think it's probably harmless to get some kind of Netflix, Netflix recommendation about the movies you to watch. But the political ads on social networks can be problematic. Medical diagnosis, or even military decisions based on AI, you know, can be d…”

“I think that the main thing that I bring is a deep knowledge and understanding about many, many different parts of the world and the international landscape to a company like Netflix that is increasingly growing globally and views its, you know, its path forwa…”

“You're competing with everyone. You know, you're competing with Netflix, you're competing with you know, with Facebook and TikTok.”

“There's this Netflix documentary called The Social Dilemma that's kind of, you know, condemns, you know, kind of social media as this kind of unique threat to civilization. And one of the things that one of the guys in that movie says is he's like, you know, s…”

“And that is why we decided to partner with Netflix on Squid Game.”

“It's going to be really hard to be excellent, and because, you know, models effectively are backwards looking, data kind of begets more data. I mean, you're going to have some, like, nasty feedback loops, not entirely dissimilar from, like, what happened to Ne…”

“I disagree with that. I think from then on, it's you owe them. You're the one that made the mistake of hiring them to be as generous as possible within reason.”

“I'm a fan of Netflix, but like, maybe not 12 hours a day. That's existence of a cow.”

“I remember meeting with Reed Hastings in, I think, 2004 and, you know, Netflix was up and running and was very successful doing a DVD rental by mail. And he literally, you know, reads, reads a technical genius in addition to being a business genius. And he sai…”

“The twenty-twenty-two period was rough and, you know, I kinda, my big mistake in twenty-twenty-two was not trimming a lot of stocks at the end of twenty-twenty-one. You know, I looked at Netflix at 6:30 then, and Amazon at one 80, and Facebook at three 80, Fac…”

“Those companies, good news, those companies can get to be gigantic, right? Because if you crack the mother load, like, you know, Netflix has, for example, entertainment, you know, you could, or like Tesla has in cars, you can build a company that's maybe multi…”

“Well, we've got this great company, 11 Labs. They can help you with it. We put them together. In a couple of months, he was in, you know, France and Poland and all over the world with this incredible technology that had his actors basically acting exactly as t…”