Netflix CEO Hastings & CFO McCarthy at Barclay's Global Conference

Netflix CEO Reed Hastings made a surprise appearance at the Barclay's Global Conference due to the announcement that Netflix CFO Barry McCarthy would be leaving the firm. McCarthy explained that he recently sold a lot of Netflix stock in order to pursue a new opportunity, and he was not interested in competing with his "life-long friends at Netflix." The WSJ reports that McCarthy is leaving to run his own company.

Hastings said that International expansion was different for them than Facebook or other Web companies, because Netflix has to get the rights to content for every new country, do local marketing, and get local hardware support. Hastings noted that iTunes expanded country by country, and it looks like they will be emulating Apple's approach. They still expect to be profitable in Canada within 1 year.

TV shows dominate movie viewing, Hastings said, and they would be rapidly expanding the TV catalog. With many of the shows I like on Hulu Plus being blocked from TV viewing, Netflix could steal many of Hulu's paying customers.

Hastings, when asked about the Starz deal, that they could "live without it." It'll be interesting to see if they renew the deal or if this is a negotiating tactic. He noted that no content provider has more than 20% of the movies or TV shows Netflix is interested in acquiring.

When asked about Blockbuster's lack of 28 day delay and if it was hurting Netflix, Hastings said that they weren't tracking it -- 98% of management's attention is on streaming, and only 2% is paying attention to DVD. He doesn't believe Blockbuster is impacting Netflix -- they're expecting a record Q4 for DVD shipments.

A recording of the webcast is available on the Netflix website.

Comments

[Perkins Cobb]

"98% of management's attention is on streaming, and only 2% is paying attention to DVD."

Horrible. What are they thinking? At this rate they won't have my money for much longer -- I'll be spending it (and more) buying all the damn DVDs that NF won't carry.

[eddie]

its their new business model and new age.this will backfire in to their faces because isp's will controlling what and how much people can download...

and if you want to download(stream) you will have to pay extra. really wonderfull stratergy that they have in this economy (rolls eyes)

[scJohn]

What will happen when the 28 day delay becomes the the 42-day delay? Look at BB new price rentals. $3.99/3 day for the 1st 6 weeks for new releases. Is this what the studios going to shove down NF throat in 2011? Will NF once again say thank you master will you do it again.

As far as Starz. With their crappy SD encode, who needs it. Now if everything will be 720p and DD+ 5.1, then that's another matter.

[jv42]

yea and streamflix is 98% assholes

[dAVe]

I find streaming a bit of a mixed bag. Far too often I put an entire season of a TV show into the Watch Instantly queue only to find that some episodes can only be viewed on the DVD. Also, I find it rare to be able to watch an entire run of most TV series available for Watch Instantly - it's usually only a few season's that are available. The most noticeable trend in streaming I see is volatility; currently I have about as many titles in the "Saved Instant" section as there are in the "Instant" - which means these one-time Instant titles had a short availability window and I didn't get around to watching them before they expired.

I'm wondering if having 98% of NetFlix management's attention on streaming will resolve any of these issues. And to beat a dead horse...for the most part these issues don't really exist in as large of scale in NetFlix's DVDbyMail business.

My Two Cents: To repurpose a Jim Gaffigan observation - Streaming is like a Bologna sandwich where as DVD/BD is the steak (hey, buddy, I like Bologna…)

[Sharp Gent]

Netflix... Maybe McCarthy realized the one mistake they made, entering the contract with Time Warner to delay new releases 28 days in exchange for lower costs on older movies. Wrong move, they were a great company with a clean slate, until they sacrificed customer preference and demand. What they COULD HAVE done is to have offer a higher subscription fee for customers who prefer New Movies. That would've been fair to DVD sales.