Netflix Competitive Advantage Curating Content

How do you look at the essences of the advantages that Netflix has, in terms of the content? I know we’ve discussed creativity and freedom, but do you think Netflix has any advantage in actually curating the content and working with producers, creators, on the ground, especially internationally?

I do and I’m a little biased because this is what I was working on for the last couple of years of my life. This notion that Hollywood is going to drive content and choices, globally, is parochial and I don’t think it holds up. I think all of these businesses are going to need to build the muscle of creating shows and movies around the world. The thing about it is, TV shows take two to three years to make and films, slightly less. Knowing these production communities take one to two years.

If you’re going to start now and say, I want to be great in content in India and you’re not already in India, you can do, but that’s three, four, five years of work. In the meantime, you’ll have Netflix and Amazon sitting on lots of data and lots of shows and the experiences saying, we worked with these people and it turned out great. They’ll be able to refine, take certain talents exclusive, figure out what’s resonating and what isn’t. That’s a pretty big moat, if you’re thinking about it in B-school terms.

Just tell me more about how you actually find creators and creativity, in local regions.

The folksy version of this is that I would get on planes and I would talk to friends who were in market and I would say, tell me every show, or every movie that you’ve been watching. I would load up, literally, a computer with 20 compact discs and get on a 12-hour flight and just watch TV. Then I would go and meet people in markets.

There’s this guy, Sanford Panitch, who did this for Fox, who ran Fox’s international efforts for years. I think of him as very forward thinking, but he was like, the only way I can do this is to fly two million miles a year. That’s an insane amount of flying but I think of it as something like that, which is you need to go to these markets and be in on them. The internet has disrupted that somewhat. I love Korean content and so I’m just watching a ton of Korean content online, that I don’t need to be in Seoul to figure out who is doing good stuff. But you need to be curious and passionate and then, ultimately, if you’re going to set up shows, you need to be in those markets, meeting people face to face.

If your goal is to be global and scale, it can’t just be one person, doing it from Hollywood. You need a few hundred people that are going to do it. Again, is it possible to replicate those things? Yes, for sure. You can do it, but I don’t think you can do it quickly; I don’t think you can do it in less than four or five years and you have to be committed, financially, that this is going to be an important part of your business.

Which is why Reed keeps the taps open with requiring content?