Netflix to Stream ‘The Last Blockbuster’ Video Store Documentary

Netflix is set to stream documentary “The Last Blockbuster,” showcasing the last-standing Blockbuster Video store in the world located in Bend, Ore., the people who work there, still rent DVD movies, and industry people who supported the former 9,000-store franchise before it shuttered in 2014. The doc streams on Netflix, beginning March 15.

The license acquisition is not without irony as Netflix co-founder Reed Hastings in 1997 first launched the future SVOD titan as a ground-breaking by-mail DVD rental service after getting fed up paying Blockbuster late fees.

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Just three years later, Hastings and former CFO Barry McCarthy flew to Blockbuster’s corporate headquarters in Dallas hoping to sell the fiscally-challenged company for $50 million. They were laughed out of the company boardroom. And the rest is history.

“A lot of people know that Blockbuster had the chance to buy Netflix early on, and they passed on the opportunity,” reads the doc’s Facebook page. “In an ironic twist of fate, our movie The Last Blockbuster is coming to Netflix. We are beyond excited for people to get to see this tribute to an era of home video on the world’s largest streaming service. Just don’t forget to rewind it when you’re done watching it and bring it back by noon on Wednesday.”

The Last Blockbuster is currently available on Apple iTunes, Google Play, Amazon Prime Video, FandangoNow, and Vudu, among other digital properties.

 

Netflix Set to Raise Subscription Fees in Japan

Netflix is reportedly planning to raise the basic subscription fee in Japan by as much as 13%, following a trend that has seen the SVOD behemoth raise monthly prices in the United States, Canada and the United Kingdom. Japan’s Nikkei 225 Stock Average disclosed the news, which helped send Netflix shares up more than 2% in midday trading.

The increase, which does not affect the premium-priced plan, would see the basic plan price increase to ¥990/month ($9.39) from ¥880/month ($8.34).

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Netflix launched service in Japan — then the world’s No. 2 home entertainment market — six years ago in 2015, largely through the efforts of Greg Peters, current COO/chief product officer, who back then was GM of Netflix Japan.

Peters, on the October fiscal call, said Netflix increased spending of more than $15 billion annually on original productions justified subscription price hikes.

“We feel like there is that opportunity to occasionally go back and ask. for members where we’ve delivered that extra value in those countries to pay a little more,” Peters said.

Netflix added 1.99 million subs in the Asia Pacific region in the most-recent fiscal period (ended Dec. 31, 2020). The region totaled 25.5 million subs, including more than 3 million in Japan. The region is Netflix’s third-lowest generating revenue per subscriber at $9.32, ahead of Latin America at $7.12 per sub. The North American region leads Netflix with $13.51 in monthly revenue per sub.

“With its rich culture and celebrated creative traditions, Japan is a critical component of our plan to connect people around the world to stories they love,” co-founder/co-CEO Reed Hastings said in 2015 at the Japan launch.

Netflix Hits 200 Million Subs: Reed Hastings Orders Denny’s Takeout

With Netflix officially surpassing 200 million paid subscribers (actually 203 million) through Dec. 31, 2020, co-founder and co-CEO Reed Hastings took to Twitter to post a picture eating Denny’s takeout solo at home.

While some might wonder why a guy reportedly worth close to $6 billion would celebrate the milestone not ordering a Grand Slam breakfast (!), the venue has special meaning to Hastings. The executive has marked several subscriber accomplishments during the streamer’s 20+ years eating steak at Denny’s — alone.

Hastings did the same in 2017 when Netflix topped 100 million subs and in 2003 when it reached 1 million subs renting DVDs through the mail — underscoring the moves with the hashtag #superstitious.

Hastings eating solo after 100 million Netflix subs in 2017.

 

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A noteworthy post among responding messages on social media came from Netflix’s other co-founder Marc Randolph: “Congratulations Reed. I never imagined this crazy idea would get this far.”

Indeed, Randolph and Hastings’ crazy idea at the time had little to do with streaming video and everything to do with one question: Could you send a CD disc in the mail and not have it arrive cracked, chipped or scratched? The answer was yes and the by-mail DVD rental business was launched with initial TV ads featuring Ryan Seacrest pitching the concept to consumers.

Randolph’s post also included a financial spreadsheet marking Netflix topping 500,000 subscribers on Jan. 13, 2002. He said that milestone took three-and-a-half “brutal years” to realize at a time when Blockbuster Video dominated the market.

“I think this only merited a celebratory cupcake,” Randolph wrote.

 

 

 

 

Netflix Rolling Out ‘Linear TV’ Service Globally

Netflix is planning to expand worldwide a test feature that allows subscribers to simply click a button and let the streamer pick programming to watch. Tested in France and other markets, the “Shuffle Play” feature acts as an old-school TV channel broadcasting shows on a loop.

Greg Peters, COO and chief product officer, said that as Netflix subs come to the service seeking to be entertained in a whole variety of ways, deciding what movie or TV show to stream can be daunting.

“Sometimes … [subs are] not really sure what they want to watch,” Peters said. “And so we’ve had the opportunity to try and be innovative and try new mechanisms to sort of help our members in that particular state.”

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Greg Peters

Peters said the new feature would enable subs to “skip browsing entirely,” click one button and let Netflix’s algorithms pick a title to instantly play.

“That’s a great mechanism that’s worked quite well for members in that situation,” he said.

Joining Peters on Netflix’s Jan. 19 fiscal webcast, co-founder/co-CEO Reed Hastings asked Peters if the feature was going to be called, “I’m feeling lucky,” or if he was going to come up with something better.

“We’re going to come up with something better than that, so standby for this,” he responded. “You’ll see it when it rolls out.”

Netflix Brass Come Out Swinging Following Record 2020 Report

Following a 2020 that saw record 37 million new subscribers, record revenue of nearly $30 billion and profit of $2.76 billion, Netflix is firing on all cylinders — the envy of the over-the-top video ecosystem and Hollywood. And the SVOD pioneer’s executives weren’t afraid to say so.

On the pre-recorded fiscal webcast, co-founder/co-CEO Reed Hastings appeared to take offense to a question from analyst/moderator Kannan Venkateshwar with Barclays Bank, who suggested Netflix was underachieving in comparison to Disney’s branded SVOD platform Disney+.

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“Underachieving, Kannan?,” Hastings responded. “The annualized return over 18 years being 40% … if that’s underperformance, we’ll do more of that.”

Hastings called Disney’s streaming video rise “super impressive,” and said Disney+ has “fired up” Netflix to up its game and compete against them on content, “show by show, movie by movie,” and catching/passing them in family animation.

“We have a long way to go just to catch them [in family animation] and maintaining our lead in general entertainment, it’s so stimulating, like [recent original] ‘Bridgerton,’ which I don’t think you’re going to see on Disney anytime soon,” Hastings said.

Earlier in the month Netflix reported that “Bridgerton,” the first original Netflix series from “Grey’s Anatomy” creator Shonda Rhimes, and featuring an interracial cast in the period piece, is on track to be streamed by 63 million subscriber homes in the 28 days following its Dec. 25 release — the fifth-highest tally in the SVOD pioneer’s history.

Spencer Wang, VP of finance and corporate development, was quick to point out that 30% of Disney+’s 87 million paid subscribers are actually from India’s Hotstar streaming service, “which I think we all sort of recognize as a bit of a different service.”

Wang said the Disney Plus sub count is actually closer to 60 million, with Netflix’s average revenue per user (ARPU) roughly double or more.

“So I think when you factor in those dynamics on the fact that we’re coming from a higher level of penetration globally, I think we feel very good about the performance,” he said.

Sarandos appeared to recognize the provocative nature of the questions posed by moderator Venkateshwar, telling Wang, “so you took the bait.”

“Can I just try to get us to chest pound some more?” he quipped.

Reed Hastings Sells $225 Million in Stock Options; Now 120th Richest Person in the U.S.

Christmas came early to Netflix co-founder/co-CEO Reed Hastings. The executive face of the subscription streaming video pioneer sold $225 million in stock options, according to a Dec. 22 regulatory filing. Hastings, who owns $2.6 billion in Netflix stock, sold $103 million worth of stock options in November. He sold another 83,000 shares on Dec. 8. In 2020, Hastings, who relinquished half of his CEO title to CCO Ted Sarandos, has sold $616 million in stock.

Bloomberg reported that 60-year-old Hastings increased his wealth by $2.2 billion in 2020, to $6.4 billion, making him the 120th richest person in the country. The increase was in part due to a 63% increase in the stock’s price, and the addition of more than 28 million subscribers. Netflix ended its most-recent fiscal period with 195 million subs worldwide.

Interestingly, Roku founder Anthony Wood, a former Netflix executive who helped launch the SVOD market in 2007 with a branded Netflix streaming player, saw his personal wealth reach $7 billion in 2020, due to the company’s stock skyrocketing 165% this year.

Hastings’ sell-off mirrors other Netflix corporate executives looking to exercise stock options before the end of the fiscal year for tax purposes. Interestingly, Sarandos has mostly acquired shares of the streamer in recent months. Netflix has a market capitalization approaching $230 billion.

 

Reed Hastings: Pandemic Video Trends Not Relevant to Real World

When Netflix failed to meet its own subscriber growth projections in the third quarter, ended Sept. 30, co-CEO Reed Hastings shrugged off the shortcoming as inconsequential “forecast noise.” Speaking Oct. 20 on the fiscal webcast, the co-founder of the SVOD behemoth contends the service’s 195 million global subs is a statistical force to be reckoned with going forward.

“We’ve been doing high 20s [in terms of millions of net adds per year] for four years,” Hastings said. “And this year on guidance for 34 million, so [we’re] setting all kinds of records.”

Hastings said the pull-through in outsized sub growth in 2020 due to the coronavirus pandemic into 2021 would be relatively modest, around 5 million to 6 million subs. He said factors such as how much the quality of the service and word-of-mouth increases affects sub growth as well.

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“Our growth sort of seesaws around that number depending on the particular conditions going on in that quarter, but year-after-year, it’s fundamentally followed that improvement in the service growth curve,” Hastings said.

The executive downplayed the pandemic significance on OTT video as a one-time phenomena with a “minor background effect” on the distribution channel. Hastings said Netflix competes against a wide range of distractions, including social media, TikTok, YouTube and Fortnite, among others. He said user engagement, subscriber churn and related trends on the service are similar to what management expected a year ago.

“There was temporary learning when there’s no [live] sports, but it’s like, well, it’s not really that interesting finding because it’s just not relevant to the [non-pandemic] world,” Hastings said. “Now we’re back in a world with partial [TV] sports and that’s fine and we’re [still] growing.

“So really, the limiter for us is what’s the quality of our service, how often, how many nights can you say, ‘oh my God, I want to go to Netflix and watch the next show.'”

Netflix Expands London Digs

Netflix has broken many molds when it comes to distributing entertainment. Working in the corporate office is not one of them.

The SVOD behemoth just signed a new lease in the United Kingdom, tripling its office space in London’s West End as the streamer expands upon original content productions (“The Crown” and “Sex Education”) in its biggest international market. Netflix is taking over the lease on an 87,000 square-foot office building on Berners Street. Netflix currently employs about 269 people in the U.K., including paying rent on two nearby buildings.

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“As part of our ongoing commitment to the U.K., we are excited to expand our operations in London,” Netflix said in a media statement. “It will ensure that we can better serve our members and the local creative community.”

While Netflix has broken barriers in the entertainment industry, including launching the first recommendation software, issuing complete seasons of original TV shows at launch, in addition to advocating for the end of the theatrical window for new movies, working in an office setting remains important to co-founder and co-CEO Reed Hastings.

In a Wall Street Journal interview last month, Hastings said not being able to work with others in an office — especially overseas — due to the coronavirus pandemic is a “pure negative.”

“No. I don’t see any positives,” Hastings said. “Not being able to get together in person, particularly internationally, is a pure negative. I’ve been super impressed at people’s sacrifices.”

Netflix, like most big corporations, shut down offices when the pandemic hit worldwide in March. Most employees continue to work from their homes. When asked how quickly he would order staff back to the office if he could safely?

“Twelve hours after a vaccine is approved,” Hastings said.

Netflix’s Reed Hastings: ‘Thank God’ Blockbuster Didn’t Buy Us

It’s hard to imagine that 20 years ago Netflix co-founder Reed Hastings and then-CFO Barry McCarthy sat in the Dallas corporate headquarters of Blockbuster Video begging the video store giant to buy the upstart by-mail DVD rental service for $50 million.

As the story goes, Blockbuster CEO John Antioco and other executives practically laughed Hastings and McCarthy out of the building. Blockbuster at the the time was a $5 billion company operating about 9,000 video stores worldwide. Netflix, by comparison, was running TV spots with Ryan Seacrest pitching consumers the concept of DVD movies in the mail. Subscription streaming video-on-demand (and Roku) was still a pipedream.

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Of course, Hastings today is the one laughing as the once mighty Blockbuster brand has been reduced to a singular independent store moonlighting as an Airbnb in Bend, Ore. Hasting is also mindful that Netflix dodged a corporate crossroad that could have significantly changed his life as well as the modern home entertainment ecosystem as we know it.

“Well, now I say thank God that they didn’t want to go ahead [with the deal],” Hastings told Yahoo Finance plugging his co-authored book, “No Rules Rules: Netflix and the Culture of Reinvention,” during an episode of “Influencers With Andy Serwer,” a weekly series featuring business, political, and entertainment leaders. “But you know, at the time, [Blockbuster was] so formidable and even later, when we went public, we were $50 million in revenue, and they were $5 billion, so a hundred times larger than us.”

Indeed, had Blockbuster acquired Netflix, it likely would have rebranded the upstart by-mail disc business. The million-dollar question remains whether the Blockbuster brass would have been receptive to SVOD and its impact on video stores. If not, the subscription streaming video business model might have died on the vine; binge-viewing left to TV on DVD boxed sets; co-CEO Ted Sarandos overseeing Blockbuster video stores; and HBO Max, Amazon Prime Video, Disney+ or Peacock just science-fiction.

“For our first decade, [Blockbuster] was such a big gorilla over our future,” Hastings said. “It was a number of things that made it possible for us to thrive, and eventually then have the chance to move into streaming.”

Today, Netflix has more than 193 million paid subscribers worldwide, and a Wall Street market cap around $223.5 billion.

Reed Hastings Discusses ‘Netflix Keeper Test’ in New Book

Netflix co-founder Reed Hastings has observed much in the service’s meteoric rise from by-mail DVD rental company to global online TV platform and movie studio.

In a new book, No Rules Rules: Netflix and the Culture of Reinvention, co-authored by Erin Meyer, Hastings recounts how his and other executives’ (such as co-CEO Ted Sarandos) thinking outside the box and unorthodox company culture spearheaded the SVOD behemoth, including eschewing the traditional way movies and TV shows are made and distributed. Think binge-viewing and by-passing theatrical distribution, among other non-traditional moves.

A key management strategy disclosed in the book, dubbed “Netflix Keeper Test,” involves monitoring executives and employees’ performance in an unusual way. The policy reportedly contributed to the departure of CFO David Wells in 2018 and subsequent hiring of former Activision Blizzard CFO Spencer Neumann in 2019.

In an interview with Variety discussing the book, Hastings said the test revolves around the question: Would you keep an employee if they wanted to leave the company?

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Hastings said Wells was a very competent CFO when it came to numbers and fiscal policy, but “not hungry” for entertainment. He said Wells’ “resignation” afforded him the opportunity to hire an entertainment CFO.

“That’s a tough one, because your heart cares for the person and the’’re great,” Hastings said. “But your head is like, ‘We could be a better company if we had an entertainment CFO.'”

Hastings admitted the “Keeper Test” could be intimidating to some executives. Indeed, co-author Meyer wrote about one Netflix director who hadn’t unpacked their boxes after one year on the job. Hastings said the “test” is no different than what any professional athlete deals with facing a career-ending injury on every play.

“We have to hire the psychological type that can put that aside and who aspires to work with great colleagues and that that’s their real love, is the quality of their colleagues or the consistency of that, versus the job security,” Hastings said.

Notably, Hastings, in the book, discusses his ill-fated decision to spin off the DVD rental business as Qwikster in 2011 — a move that contributed to Netflix shares plummeting 75% and calls for Hastings’ firing. Nearly 20 years later, Netflix continues to rent movie discs despite the fact package media’s fiscal impact (and subscriber tally) has all but been removed from the company’s financials.