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Netflix CFO talks Watch Now selection, competition

Ben Drawbaugh

The initial reaction to Netflix's Watch Now feature is "wow this is great," but when the reality of the selection kicks in, the appeal fades away. Obviously this isn't news to Netflix and according to the CFO Barry McCarthy it isn't a question of new vs old, but one of good vs bad. That sounds great and all, but the reality is that no matter how bad a movie is, people want to see new movies. Evidently the problem is that access to new movies via a subscription model is already spoken for by cable operators. He goes on further to explain that the cost of winning these contracts away are dependent on Netflix's ability to grow the subscriber base. Now if you're thinking, why not offer the movies via PPV? According to Barry, only the subscription model makes economical sense to Netflix as ad-supported services such as Hulu generate "scant incremental revenue." He even gets a little feisty when he says the "big question" is what are Apple and Amazon going to do when they realize the PPV model they are chasing now is not successful?

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