NEW YORK – While it’s easy to get caught up on how Netflix has changed the media landscape over the last decade, the company’s chief content officer, took a moment during his Q&A at the UBS Technology, Media and Telecom conference to highlight the 34 Golden Globe nominations the company received earlier this week as validation that it’s on the right path.
“We received 34 Golden Globe nominations – 17 in television and 17 in film – including four best picture nominees,” Ted Sarandos said. “For us, in terms of where we started in original film approximately three years ago, we’re very excited, but we’re also excited for the creators to be recognized by their peers and the film community.”
The nominations are a validation of sorts, Sarandos said. “People ask all the time, why did we start making original content? I said it was the realization that if all entertainment was going to come into the home via the internet, studios were going to want to start their own businesses and not sell us their programming and so we better get good at it.
“The moment of truth is when the customer pushes those buttons on their remote control? Where do you find the things you love? Where is the programming you can’t live without and is it being delivered to you seamlessly? That has been our mission from the outset.”
From a disruptor standpoint, Netflix is the biggest one. The platform ushered in a completely different way to offer on-demand content to consumers. And while many aren’t always quick to embrace change, Sarandos believes habits established by consumers end up being among the most sustainable.
“Releasing all the episodes or content at once turned out to be a big inflection point in entertainment,” Sarandos said, referring to the binge-watching phenomenon. “Our plan was to make great shows and it occurred to us that it would feel disconnected to have one show where you had to watch one episode a week while everything else was all you can eat.”
Sarandos noted that House of Cards was the first show they had explicitly written to be watched all at once.
"We knew beat for beat and episode by episode where that show was going to go over six years, so the show won't be a failure if it doesn't go to season seven.” – Ted Sarandos, Netflix
“It was written with the understanding that everybody saw the last episode and so there wasn’t a need to catch the audience up on things. We did a two-season pickup, which was kind of unheard of at the time, meaning when we wrote for the first hour, we also knew there was going to be a 26th hour. That’s had a profound impact on the creative process of television,” he said.
“Projects should be made to be exactly what they should be creatively. The Crown is an example. The Crown was greenlit, conceptually, as a six-season show. We knew beat for beat and episode by episode where that show was going to go over six years, so the show won't be a failure if it doesn't go to season seven.”
Asked if Netflix has seen a drastic shift in procuring content and talent for new projects, Sarandos says the market has remained relatively stable. While admitting there are a few projects that can get “heated,” which in turn drives up the price, the company keeps a watchful eye on the impact said projects could have upon the business.
“If a project is expensive, heated and competitive but in the end is going to have an enormous business impact, we’re of the mind that we should buy it. We don’t have much concentration risk on one project where overpaying changes the overall content cost,” he explained. “But one of the biggest changes we’ve seen is that creators generally want to be on the network they watch, and they also want to be on the network their friends are watching. We’ve always believed that if you pick the people and the projects well, you’re enabling people to do the best work of their life.”
Sarandos also said it is looking to provide more data on customer consumption patterns, too, adding during the first seven days of availability, The Irishman was watched by 26.4 million accounts, clarifying the company’s definition of watched means customers streamed at least 70% of the film. He expects that number will balloon to 40 million at the 28-day mark.
He said it’s not just consumers who will benefit from an increased transparency in reporting. Sarandos said the seven- and 28-day data is also being provided to producers, allowing them insight into how their titles are performing on the platform.
“We're increasing the release of those numbers more publicly. But the reason we aren't doing it any faster is that we're trying to condition the market as to what exactly they mean,” he said. “When we give a number, it's not apples to apples with a box office number or to a Nielsen rating point. If we're the only ones reporting in this form, I think it's easy to get mixed up, so we’re trying to walk people through how to think of a Netflix viewer versus a movie ticket buyer or a watcher of a TV show.”
Asked about Netflix’s film strategy over the next five years, Sarandos believes the company is making movies that might otherwise be difficult to undertake and that they’ve quickly evolved to making the movies that everyone wished they had made.
“That’s what I’m shooting for. These are the films you would've seen in theatres and that any studio would be thrilled to have, but they're being produced the way the filmmaker wanted to make it or could make it. That encompasses big, theatrical-style events but also small, indie movies and everything in between. I think people's tastes are diverse and our brand is equally broad and inclusive.”
