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September 12, 2020

What Netflix CEO Reed Hastings Thinks About Disney+

Netflix Inc (NASDAQ: NFLX) co-CEO and co-founder Reed Hastings was interviewed by CNBC’s Andrew Ross Sorkin this week and shared his thoughts on the streaming video platform and its competitors.

Netflix shares are up 55% in 2020.

Tech Vs. Media: Hastings wants Netflix to be called an entertainment company, instead of a media company or technology company.

“We’re tech powered, but we’re not really like Microsoft in multiple areas of tech, or Google. We’re a single application, a single service,” the CEO said.

“We have more employees in Hollywood than we do in Silicon Valley,” he said. “Media tends to involve advertising.”

Netflix has a higher price-to-earnings ratio than other entertainment names like Disney and Lionsgate, according to CNBC.

Sizing Up Disney: Sorkin asked Hastings how many subscribers he though Disney+ would have in its first year.

“Maybe 20 million,” Hastings said.

Disney+ has already signed on 60 million subscribers within its first year.

In a bit of praise for the Mouse's rapid streaming growth, Hastings said it took Netflix over 10 years to hit the 60-million figure.

In the next five to 10 years, Netflix will be a stronger competitor in family content than rival Disney, he said.

Hastings said he's a fan of Disney putting “Mulan” on Disney+ immediately, showing their all-in commitment to streaming.

Hastings On Other Competition: It's possible for media to compete with Netflix if “they’re willing to focus completely on streaming,” Hastings said.

“All it takes is focus on commitment,” the CEOsaid. “Look at Warner — they did not put 'Tenet' on the HBO Max service."

Continued consolidation in media is ahead, he said, in order to compete with Netflix.

“Typically you bulk up to take on the other guys,” Hastings said.

He mentioned the moves of Disney acquiring much of Fox and Viacom and CBS merging to form ViacomCBS Inc (NASDAQ: VIAC).

This story was originally published by Benzinga
© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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