Netflix Chief Reed Hastings Says The End of Linear TV Is Coming Over the Next 5-10 Years
Netflix co-CEO Reed Hastings declared during the streamer’s Q2 earnings interview Tuesday that linear television will go the way of the dinosaur within the next decade.
“It’s definitely the end of linear TV over the next 5 to 10 years,” Hastings said while discussing Netflix’s financial and subscriber results on the pre-recorded Q&A, which came on the heels of the reveal the streamer lost 970,000 subscribers in Q2. That loss was actually a win for Netflix, which had originally expected to lose 2 million subscribers by the end of June 30.
Though very bold, Hastings thoughts on the state of linear television are hardly a shock given his position at the top of the world’s biggest streamer — and they carry forward data touted by Netflix earlier Tuesday.
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In a letter to shareholders breaking down its Q2 performance, Netflix wrote: “While we always have room to improve, we’re very pleased with how far we’ve come in providing so much satisfaction and enjoyment to our members. For instance, in the US, which is one of the most competitive markets in the world, we drew more TV viewing time than any other outlet during the 2021-22 TV season (see chart below), nearly matching the combined total of the two most watched broadcast networks. And, as Nielsen will announce on Thursday, our share of US TV viewing reached an all-time high of 7.7% in June (vs. 6.6% in June 2021), demonstrating our ability to grow our engagement share as we continue to improve our service.”
Netflix plans to launch its cheaper, ad-supported option in early 2023. The streamer has struck an exclusive pact with Microsoft to help build out that tier, promising it won’t resemble advertising on broadcast TV.
“We’re optimistic that over a couple of years we can deliver an experience that is fundamentally different than the advertising experience on linear networks in a way that fundamentally benefits all the stakeholders,” Netflix chief product officer and chief operating officer Greg Peters said during the earnings interview.
Netflix execs acknowledged the streamer is talks with studios over rights issues as they prepare the ad-supported option.
See the chart published in Netflix’s Q2 earnings report, data cited to Nielsen, below.
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