Ted Sarandos

back on before, you know, from DVD into streaming, our big mantra was, our content has to be better than free.

Because at that time, piracy was the competition.

And we had to be better than piracy.

We had to give people a reason not to steal, because it was so easy to download back in those days.

So that was always been our focus.

We have to be, we're a super consumer-focused business.

We constantly are looking at how we're entertaining people.

We look at our internal metrics, how we grade ourselves on how we're entertaining people on things like, do they complete?

How fast do they go from season one to season two?

Do they tell a friend?

Do they post about it?

Do they give it two thumbs up?

All this internal is always focused not on the quantity of watching as much as the quality of the watching because it has to be good enough to pay for it.

Well, look, one of the things I figure out as we go is people have completely different opinions of what they want and how they want it and what's premium to them and how they define it.

And the one part of the audience that we were not addressing was the one who wanted a lower price point and didn't care about ads.

And there's a lot of them, it turns out.

And particularly, you're talking about young people who grew up mostly watching ad-interrupted content constantly.

So for them, it was a completely different thing.

The reason we were so not in the advertising business at the beginning was it was kind of a classic counterposition move.

You know, when we first got into DVD, our competition was blockbuster video stores.