Reed Hastings has been a lot more talkative than usual lately, and current and potential Netflix (NFLX) investors should take note of some of the things that he's said.
To help promote a co-authored book about Netflix's corporate culture -- it's called No Rules Rules: Netflix and the Culture of Reinvention -- Hastings has given interviews with the New York Times, the Wall Street Journal, Forbes, Variety and Bloomberg. Here are a few notable things that the Netflix co-founder, chairman and co-CEO, who has shown a knack over the years for both thinking out of the box and seeing the big picture, shared with interviewers.
1. Hastings Is Open to Eventually Expanding Into Live Sports and Video Games
When asked by Variety if Netflix could eventually offer live news and sports, Hastings suggested live news was unlikely, but left the door open to sports, as well as some other content that Netflix doesn't currently offer.
"You know, [Netflix] could," he said. "I doubt news, but sports, video gaming, user-generated content - if you think of the other big categories, someday it could make sense."
Hastings qualified his remarks by saying that for the next couple of years at least, "every content dollar" has already been budgeted for movies and shows.
2. Hastings Remains Skeptical About Expanding into Ad-Supported Services
"You know, advertising looks easy until you get in it. Then you realize you have to rip that revenue away from other places because the total ad market isn't growing, and in fact right now it's shrinking," Hastings told Variety. "It's hand-to-hand combat to get people to spend less on, you know, ABC and to spend more on Netflix. There's much more growth in the consumer market than there is in advertising, which is pretty flat."
The comments echo past earnings call remarks in which Hastings argued that Netflix would face an uphill fight competing against the likes of Facebook (FB) and Alphabet (GOOG) to build a large-scale ad business.
3. Hastings Expects More Media Consolidation to Happen
"I imagine there will be more consolidation like Fox-Disney," Hastings told Bloomberg. "The traditional players will combine in various ways to get to critical mass like Disney (DIS) has."
Netflix, for its part, has been largely averse to making big acquisitions. The company bought comic book publisher Millarword in 2017 for its IP, and bought StoryBots, a creator of educational kids' content, in 2019.
4. Hastings Plans to Stay at Netflix At Least Until 2030
On Netflix's Q2 call, Hastings said (following the appointment of Ted Sarandos as co-CEO) that he's "in for a decade." When asked about the comment by Variety, he said that the remark means 10 years is "the shortest I'm here."
"At least for the next decade, I'm super-excited by what we're doing and full-time, so it was a statement that it's not a short-term situation," he added.
5. Expanding Netflix's International Content Library Is a Top Priority
"What's next is becoming a great Turkish developer of content, becoming a great Egyptian developer of content, and sharing that with the world," said Hastings when asked by Variety about what Netflix's big opportunities and challenges are going forward.
Netflix's global scale gives it an arguably unmatched ability to justify giant investments in foreign-language content, as it can make such investments pay off both by generating a lot of viewership in their home markets and getting some fraction of viewers in other markets to watch.
6. Hastings Remains Worried About 'Sideways Threats'
In the past, Hastings has argued that Netflix competes as much against alternate entertainment sources such as Facebook, YouTube, Fortnite and TikTok as it does against direct streaming rivals. Along similar lines, he suggested to the NYT that "sideways threats" keep him on edge.
"If you think of Kodak and Fuji, [they competed] in film for 100 years, but then ultimately [the threat] turns out to be Instagram," he said.
7. Hastings Believes Netflix's Relative Lack of Internal Processes Is a Key Strength
As expected given the subject material of his book, Hastings spent a lot of time extolling how he thinks Netflix's unique and demanding culture -- a culture that obsesses over hiring top talent, invites constant feedback/criticism from co-workers and doesn't hesitate to push out "B" employees -- helps set it apart.
He also spent a bit of time arguing how the considerable autonomy given to Netflix employees, and the relative dearth of internal processes preventing employees from acting, makes it more agile than companies with more process-oriented cultures (Google, HBO and Disney were three firms that he singled out as being this way).
"I'm confident that [our culture] will help us serve our members best now, and find ways of serving our members better than HBO does, or better than Disney does," Hastings told Forbes. "Because they've got so much internal process around things that slows them down."