Streaming giant Netflix likes to think about original content with a genuine local focus, co-CEO Ted Sarandos said Tuesday at a TV industry conference in London.
Speaking during the keynote speech at the Royal Television Society (RTS) 2024 London Convention, of which Netflix was the main sponsor, he also shared his thoughts on the streamer's UK successes, including Baby Reindeerfor which star Richard Gadd won Emmys this weekend for Outstanding Actor and Outstanding Writing for a Limited or Anthology Series or a Movie, the pinnacle of creativity in the UK.
“Choice and control” are key in the streaming era, the executive argued, calling the “change” fundamental. “We had two big competitors,” piracy and Netflix's DVD business, he said, calling it “a painful split” when the company gave up its DVD business. He quoted Steve Jobs as saying that cannibalizing your own business is critical to continued progress and
“The public doesn't care about windows,” he said. “They never talk about them at dinner.” Do we need so many shows and movies? Yes, you can't program just “for a sensibility,” he said. “You have to love everything.” People who love The crown even love Dolly Parton's Heartstringshe shared. “Put the audience first.”
Think about the work from the perspective of a fan, not a critic or media executive, Sarandos said. Aiming for a global audience is wrong. “There really is a global audience for everything,” he said, calling instead for a genuine local focus that can travel. Supacell AND Baby Reindeer have become global hits because they are “authentically British”, he suggested. And they were commissioned by a local British team based here, he added.
Success is more art than science. Algorithms can't “reverse engineer success,” and if they could, we would never have failures, “but we do,” he admitted.
Sarandos also shared that Netflix owns less than 25 percent of the intellectual property in its UK catalogue. “There’s so much potential in TV today,” he concluded. “This generation loves stories as much as we do, maybe more. We just need to find the right way to connect with them.”
On Tuesday, Sarandos also recalled having shown the first trailer for The crown at the RTS event seven years ago, extolling that the show was an “upheaval of common sense”.
Saying he has long thought of the UK as “the birthplace of prestige television”, he said the company has invested $6 billion here since 2000, with more than 30,000 cast and crew members. Over 100 productions in the UK, including Bridgerton Bridge, Thursday Murder Cluband the new Knives out film. He praised the country's creativity and skills, its production incentives and education. “Britain has become one of the best countries for TV and film,” he concluded.
Saranos said he and his wife like different content, so he likes to watch things together that they both like. She “loves” Emily in Paris that the two have finished sending, he said.
Netflix, which launched in the UK 12 years ago, is the first streamer to sponsor the annual RTS event, Anna Mallett, Netflix's vice president of production EMEA/UK, said in her opening remarks. She also touted that the UK entertainment industry is expected to surpass £100bn ($132bn) this year.
At another conference in London this summer, Sarandos co-CEO Greg Peters noted that streaming, linear, advertising and gaming present a combined revenue opportunity of more than $600 billion, meaning there’s still plenty of room for growth for Netflix. A chart he displayed on a screen listed $300 billion in linear and streaming subscription spending, $180 billion in advertising and $140 billion in consumer spending on gaming.
Netflix beat Wall Street expectations with strong financial and subscriber growth in the second quarter (8 million new subscribers for 277 million total users worldwide) it reported on July 18. But management is expecting slower growth going forward, setting expectations for lower paid net adds in the current third quarter compared to a year earlier, in part because the company has already reaped gains from its successful crackdown on password sharing, launched about a year ago. Many Wall Street analysts came away feeling like the results didn’t move the needle too much in terms of financial forecasts and sentiment on the stock, but some raised their share price targets.