Netflix Chief Executive Reed Hastings maintained a calm and measured tone in discussing Disney’s planned acquisition of much of 21st Century Fox — and the Burbank entertainment giant’s plans for a rival streaming services that some have dubbed a prospective “Netflix killer.”
Hastings said everyone recognizes the costs of competition — but few see the opportunities created when a challenger attempts to gain a foothold in a fast-growing market like streaming.
“They’ll try many things — separate sports, other flavors. If it works, then we get to learn from that,” said Hastings during the company’s fourth quarter earnings call. “So our view would be to let them try to innovate on those aspects, watch what they do and learn from consumers … Do they really love it?”
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Netflix, for its part, will continue to follow its own path, even as Disney launches a streaming service that Hastings predicts will succeed on the strength of its brand and the popularity of its franchises.
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“I know I’ll be a subscriber of it, for my own personal watching,” Hastings said.
In the end, Hastings asserted, all boats will rise with the streaming tide.
“We’ll all learn from each other and total streaming will grow faster because of the competition,” Hastings said.
Hastings described himself as “as surprised as anyone else” that Fox is willing to sell the majority of its entertainment empire — and noted that the combined media conglomerate would hold tremendous pricing power in negotiations with pay TV distributors.
But the combination won’t imperil existing multi-year deals Netflix has already struck with Fox for certain shows, like American Crime Story: People vs OJ.
“As long as they keep making those shows, they continue on Netflix,” said Chief Content Officer Ted Sarandos. “Our Marvel series that Disney produces for us — we own those shows. They run until we cancel them.”
So while Disney owns the underlying intellectual property for Jessica Jones, Daredevil or Luke Cage, the Netflix shows based on these comic-book characters remain the streaming service’s property. “We get to use them for a very long time,” said Hastings.
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