Reed Hastings, Netflix’s Chief Executive, stated that he was in favor of the planned acquisition of Time Warner Inc. by AT&T for $85.4 billion, provided that they continued to treat his renowned media streaming service in a fair manner. The Wall Street Journal hosted a technology conference in Laguna Beach, California and that’s where the CEO said that it was necessary that Netflix’s content be given the same treatment as Time Warner once the deal comes into effect. He said that they would love the open competition, if that’s the case. Hastings has been outspoken in his support for net neutrality, which asserts that some types of content should not be favored over others by internet service providers.
Hastings said that net neutrality was key, which hasn’t exactly been AT&T’s favorite topic. On Saturday, AT&T had announced the landmark deal, which would provide the company with control of cable TV channels such as CNN and HBO, the Warner Bros film studio and a number of other coveted assets, which would end up altering the media landscape. However, the share price of both Time Warner Inc. and AT&T declined on Monday regarding concerns that the acquisition would not be able to clear the scrutiny of regulators.
There has been a slowdown in the growth of subscriptions for Netflix in the US as the market is becoming mature and there is plenty of competition from other services such as Amazon.com Inc. and Hulu. This has led to speculation that Netflix could be the next target for acquisition, but Hastings has made it clear that the company is currently focused on running independently. Nonetheless, the concerns exist as entertainment firms are facing an uphill battle, especially due to virtual and augmented reality systems. But, the CEO for the streaming service has said that he is keeping an eye out for hallucinogenic drugs.
On Tuesday, at the conference, he discussed the potential challenges that streaming services are expected to encounter in the future, which also include ‘pharmacological’ competition. He went on to outline a scenario similar to the Matrix in which users would be able to experience hallucinatory entertainment by taking a ‘blue pill’ and come back to reality by taking a ‘white pill’. He believes this could happen in the next twenty years or so. Hastings explained that his firm was working hard in luring the attention of their users from social media, apps and other major competitors.
Netflix streaming service is now available in about 130 countries and on more than 600 IPSs, but it is still unclear as to what its rival is going to be in the years to come. The chief executive acknowledge the possible future challenges and said it could be anything ranging from gaming, VR to pharmacological. He added that the idea of a blue and white pill was quite viable and said that if this did become the primary mode of human entertainment, it would be a serious threat to their business. During the discussion, the Netflix CEO also asserted that the fundamental goal of the firm was to use entertainment for eliminating boredom and loneliness.
Original content such as the hugely successful and fascinating Stranger Things can pave the way for the future of Netflix. Hastings said that they would make an effort to surpass the Hollywood enclave and give rise to some of the most high-end creators in the world.
He said that HBO, being one of the properties of Time Warner, would fall under AT&T’s control after the acquisition and they didn’t want it to be given unfair advantage over Netflix in the long term. The traditional television landscape has changed considerably and media companies are looking for ways to adapt. According to YouTube, there has been a decline in television viewership by people between the age group of 18 to 24 years old in the last five years and this decrease is approximately 40%.
Susan Wojcicki, the chief executive officer of YouTube, said that almost a billion people visit their video sharing platform for listening to music, video-game play, watching how-to videos, tutorials and a lot more. She said that this was truly an amazing time as video distribution is widely available and a lot of people are creating content round the clock. The CEO of YouTube said that their aim was to develop into a platform for the next-generation of platform companies. Apart from free videos, YouTube also has a YouTube Red subscription service that charges $10 for a month.
While exact subscription figures were not disclosed, she did say that they were positive. Nonetheless, industry insiders have said that the cost of making professional quality programs is on the rise. Streaming services like Netflix and Amazon Prime have had to ramp up their spending on developing original content, which requires investment of billions of dollars.