Netflix CEO Reed Hastings says “Amazon is the best competitor we’ve ever faced” — but he estimates his retail rival is losing between $500 million and $1 billion a year on its streaming content, according to a report on AllThingsD. Hastings says he bases those figures on the value of content deals Amazon won when the rivals competed head-to-head. To become a real threat, Hastings says Amazon CEO Jeff Bezos will have to spend a lot more money. Netflix has said it plans to spend $2.1 billion on content over the next year. Amazon spokesman Andrew Herdener responded to Hastings’ remarks via email: “We don’t comment on our individual investments but it’s correct that Prime Instant Video is an amazing value for customers. Not only do Prime members get unlimited streaming video, but they also get free 2-day shipping and the Kindle Owners’ Lending Library as well.” Last week broadband service company Sandvine pegged Netflix’s share of Internet traffic at 33% and Amazon’s at 1.8%. Netflix’s stock closed virtually unchanged today at $80.90 down 0.71%.
Hastings also responded to investor Carl Icahn, who recently acquired almost 10% of Netflix and contends the company should be acquired by a larger firm. “We think we can make it in the long term absolutely on our own — we’ve been doing that for 10 years,” Hastings says, noting that Netflix has long been the subject of takeover rumors. Hastings and Icahn met this week in New York but both declined to comment on the meeting. “There’s a basic philosophical difference here,” Icahn said Friday. “I believe the shareholders, the rightful owners of the company, should decide whether a company should be sold, not the management.”
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