While it’s had a “good run” the Netflix CEO doesn’t foresee linear TV lasting another 20 years.
Good numbers from Netflix have set off another chorus from the media, warning of cable TV’s demise. However this time, the chorus was led by Netflix’s own CEO Reed Hastings. On the company’s first quarter earnings call, Hastings warned that after an “amazing 50-year run,” linear TV’s time was up. He also took this opportunity to highlight confusion among traditional TV companies, who may see the same writing on the wall, but have no idea what to do about it. Hastings praised Viacom’s “Noggin” service, a video library of programming for young children, and suggested that other media companies need to figure out how to create similar offerings. His overall message was clear: the internet is replacing cable as the primary vehicle for television content to reach viewers. TV as we know it today is going away.
Among Hastings’ other announcements was news that the service had added almost 5 million subscribers over the past quarter, bringing their total up to 62 million. International launches likely had much to do with Netflix’s higher-than-expected subscriber gains, but financing that global expansion has also taken a toll on the company’s profits. Among other statistics discussed on the call, the average Netflix user spends about 2 hours a day on the site. While that number is dwarfed by the 5 hours the average American spends watching television, it towers above time spent on any other single TV network. While Netflix seems to have an advantage over traditional television, when discussing new competitors in the OTT space, Hastings insisted he wasn’t worried, suggesting that streaming services from cable networks like HBO and virtual pay-TV products like Sling TV posed a much bigger threat to the TV providers than to other players, Netflix included.