When Ted Sarandos speaks, the entertainment industry listens, so when the Netflix co-CEO sat by the fire and chatted with Wall Street Journal Editor-in-Chief Emma Tucker at the WSJ Tech Conference on Tuesday, Hollywood Observer There will be no shortage of them. Read Ted’s Tea Leaves.
But Sarandos didn’t give them much to chew on. The executive spoke about Netflix’s approach to generative artificial intelligence, live sports and events, advertising, gaming, and other areas detailed in last week’s quarterly earnings report.
But he also kept another big entertainment industry topic of the week top of mind: Bob Iger’s successor top of mind, and the succession battle at Disney, where James Gorman will become chairman next year. asked a question.
If Gorman approached him about the job, would Sarandos take his call? “That’s not even on my mind,” Sarandos said.
But will Netflix’s co-CEO model work for a company like Disney?
“It’s hard to recommend this program to other companies who don’t have a good understanding of their business and, by extension, their culture,” Sarandos said. “I understand their business very well, but I don’t understand their business culture.”
“[Netflix founder Reed Hastings] He told me that he had a successor in mind in 1999 because he intended to start a company that would follow in his footsteps. I think that was in his mind when he and I started doing business together 10 years ago. And I think that was in his mind probably three years ago, maybe five years ago, when he officially named me co-CEO,” he continued. “I think Mr. Reed has had time to prove the co-CEO model works well on its own for this company, and for Netflix, as he has become chairman of our board.”
Sarandos also reiterated that when it comes to the company acquiring more live sports, “I’m not saying never, but I would say at this point we’re in the live events business.” “It’s very interesting and very exciting for the whole world to come together and see the same thing at the same time. They don’t do that very often, and that’s what makes it so special.”
“I think the league does a phenomenal job of building fandom, and because of that, they get to keep all the money. And distribution is pretty profitable for a full-season league sport. “It’s a low-rate business. I hope we can add some value to them. I think this is something we do on our own, but we can make it work.” I added.
And when it comes to the use of generative AI, Sarandos said he expects the technology to have a “significant impact” on products, but is less certain about the impact on content.
“I think the internet will be powered by Gen AI to make what already works work better,” he said. “So I think that includes product selection, sales, and UI creation.”
“I see Gen AI as a tool for creators to create content, rather than a tool for Netflix to create content on behalf of creators,” he said. “So I feel like if we pass the big test of whether we can make better shows by using this tool, then we have a chance. Then it could be really transformative and useful. But , if not, I think it will be incorporated somewhere in the current hype cycle.”
Netflix also has advertising, gaming and live experience businesses, but one area it doesn’t expect to compete with is user-generated content, which is dominated by YouTube and TikTok, Sarandos said. he said.
“In one sense, this will be a training ground for storytellers and creators, which is great. In another sense, it’s a way for people to kill time,” he said. “I think killing time and spending time are two different activities. We have to be careful not to get too caught up in following everything that people are doing. I think a lot of what I do there is interesting and exciting.
“If you look at the monetization model, it’s impossible to do anything on the scope and scale that we’re doing at Netflix through that model. It’s not monetizing enough and creators have to put up with everything. ‘We need our own money to do that,’ he added. “So I think the model itself is self-limiting in terms of content. So we’re in two different playing fields in terms of programming, but it’s about how much time people spend on TV. It’s a method, so of course I’m careful.”
