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Netflix co-founder Reed Hastings: ‘Thank God’ Blockbuster didn’t want to buy us

Netflix Co-Founder and Co-CEO Reed Hastings joins 'Influencers with Andy Serwer' to discuss the company's place among Silicon Valley's tech giants.

Video Transcript

ANDY SERWER: You guys are big and getting bigger. But if you compare your business, Reed, to the other FAANGs, people say, oh, you know, they're not an ecosystem. All right, Netflix, they're just movies, and that's it.

And you look at Google, and Apple, and Amazon, and, my goodness, they do so many things and they're going to take over the world. Netflix is this little thing here. Is that an issue or not?

REED HASTINGS: That's accurate. I mean, the GAFA companies are, you know, are big, broad, tech platforms. And the four of them, plus Microsoft, are formidable. They've got much bigger market caps. They're in multi-business lines.

Many of them have ad support and are very data-exploiting in that way. And we don't have any of that. You know, we're just simple, extremely great, entertainment company. And then, you know, for, again, for about $15 a month, you get amazing content.

ANDY SERWER: Do your ambitions ever include news and sports?

REED HASTINGS: I don't think so. I mean, those are very different and well-covered. And we've got just so much we want to do in entertainment. So we're going to stick on our current path for quite a while.

ANDY SERWER: I want to ask a little bit about you, personally. And, of course, well, we share a background, Reed. And we went to the same college at the same time, even, a little bit, Bowdoin College. And then, as I said, you were in the Peace Corps.

And then you ended up studying software at Stanford. So talk about the mindset that you need to succeed in business. Is it liberal arts and science? I mean, it kind of sounds like Steve Jobs' vision a little bit.

REED HASTINGS: You know, there's so many different paths to business success. I don't think there's any one formula. I've just been incredibly fortunate. So when I came back from the Peace Corps, I needed to get a job. I got a job in a computer company serving coffee, OK, in a lab.

And it happens, coincidence, to be the very first dotcom ever. In 1986, this was, OK. And then because I was around a lot of internet people, I learned a lot. And then I started following the internet and was part of it. And then in, you know, 10 years later, in 1997, it was clear that the internet was growing and getting faster, and would someday be able to do television.

And that's what made me differentially confident that, you know, you could do DVD by mail for a couple years and then evolve into streaming. And, again, it was because I had already had 10 years of experience on the internet, seeing it get faster, feeling it. And that was all because of the company I ended up serving coffee in. So there's a lot of randomness in life.

ANDY SERWER: What was the company, by the way?

REED HASTINGS: Symbolics.com.

ANDY SERWER: Oh, right, I didn't know that one. And then I want to talk about another anecdote in the book where you were walking in to the offices of Blockbuster 20 years ago, I think, and looking to sell the company with your co-founder for $50 million and were rebuffed. Do you regret that? I mean, or do you say, oh my god, thank goodness I didn't do that?

REED HASTINGS: Well, now, I say, thank god, that they didn't want to go ahead. But, you know, at the time, they were so formidable. And even later when we went public, we were $50 million in revenue and they were $5 billion, so 100 times larger than us. So for our first decade, it was such a big gorilla over our future. And, again, back to the role of luck, there was a number of things that made it possible for us to thrive, and, eventually, then have the chance to move into streaming.

ANDY SERWER: I want to go back and talk about some of these big tech companies. Are you concerned about privacy, and their scale, and the impact on the election, say, when it comes to Facebook, for instance?

REED HASTINGS: You know, we're really focused on entertainment. And we're not really in that whole other tech ecosystem. So what we think about is, you know, what shows do people want? What movies do they want? And then COVID plays a role.

The election plays a role. Those things come and go. But, again, our world is really about data security, keeping each member's data, you know, just at Netflix. We don't import data.

We don't share data. We don't sell data. It's one app that does exactly one thing-- entertainment-- really well.

ANDY SERWER: How come you've never gotten into advertising, Reed?

REED HASTINGS: Same thing. I mean, HBO doesn't, we don't. It's great to just be able to focus on our members, and not to really think about advertisers, not to think about data, and really just to serve our members.

And, again, we talked about the stock price a little. The membership's grown. You know, our members love somebody who does one thing extremely well.