I am off to China, writes the president this morning. There is strategic giant Netflix expanding its platform to include live sporting events, offering special coverage of NFL games. Strategic first Christmas Day game in 2024, plans to show first regular season game in September. This comes as the Federal Communications Commission is probing the NFL over high costs and limited access to strategic games. Consecutive games say as much as 87% of administrators league to the gales via broadcast, warning streamers gaining access are harmful to the sports industry, not to mention expensive. Joining me now, Fox Business conclusive is Co-CEO of Netflix Ted Sarandos. Great to have you, thank you so much for being here. Upfront season, I know you are going to be presenting tomorrow.
In New York, presenting tomorrow.
I want to ask about that. For a long time you avoided sports rights. What changed? When did you view live sports as a big opportunity for you?
We have a live event strategy that started with comedy, Skyscraper Live. Live is part of that. Where can we add to that? In case of the NFL, where can we add value to the NFL? Our audience is much younger. We are to expand the audience for the NFL, bring those games to the public in an unbelievable way. 8.9 to join Netflix includes Christmas Day football.
Versus free on channels you have sports in your package.
First Christmas Day games on the air, both away and visitor team available on broadcast in local markets. And most folks are paying for television packages that are much more expensive.
How essential would you say live sports is for the growth of Netflix over the mid and long term then?
In leaning into live events, includes live sports. If we just did in Japan, we had the World Baseball Classic, broke all records for us in Japan. So again, leading into events, we're not bidding on whole seasons including the NFL, but found the NFL would be a great partner. And looking to innovate constantly, I feel a great American story, great American product, leaning into investing in people, love expanding reach, going where people are. You know, move a little bit from linear, more on demand. Games aren't there, seems ridiculous, the opposite direction of the American consumer.
Follow where people are going. That is why I want to ask you about video on phones and what you are doing in terms of vertical video. You disrupted television a long time ago. Are you becoming a modern version? How do you see Netflix changing in terms of deeper into advertising and deeper into some live things that you are talking about becoming?
I think when we started doing what we're doing, started in the U.S., then got into streaming, looked at it and said the counter position was not to do advertising. We were frustrated. What were people frustrated by? Waiting for the next episode. We launched all episodes at once. Not to disrupt the market for disruption's sake. If you did not continue to innovate, you would be destroyed. Lean into what consumers want, build around what consumers want to win. Not beholden to old, reduce waiting for next week, a business model, not customer desire.
The House of Cards was great. So when you are talking about this next stream of growth at Netflix and you look at vertical video going, you know, on the phone, I mean, are you competing directly with things like TikTok, YouTube, Meta? Is that how you are looking at it?
Looking at basically, we look at moments of truth. People pick up the remote control, push a button, see what they watch. Most takes place on television. Younger people watch more on phones, not typically professional content. So looking at all different ways people are engaging with screens, primarily big screens, television screens, then using the mobile phone to help enhance discoverability, to build fan bases deep in programming. Really something we pushed into historically. Our mobile interface basically was a mimic of what was on television. People use phones differently. We leaned into new things, vertical video we added to mobile. So that is the kind of evolution, how people are using more than one screen at the same time.
What do you say to the critics who are leaning into this segment about streaming sports? Should leagues be receiving this antitrust protection? When it comes to what you are doing, you are competing with everybody. So moving more premium games behind streaming platforms, I have a friend, my son can't watch the Knicks. We go to Amazon. Are you at risk to get a court order?
And an antitrust? Opportunities, people go where they form those habitats. If you add value to the consumer, they will pay you back and show up. I feel like we're able to do that with live sports. Opening day baseball for the Yankees and Giants, it was really, you know, opening day baseball happens in the park but hasn't been a TV event. Opening day baseball we can do. I think leagues have to continue to reinvent, to invest as well, find new partners who can take them into the next generation.
