Hastings On Hulu Plus: If They Become A Competitor, That’s Probably Healthy For Us

Today at the Web 2.0 Summit in San Francisco, Netflix CEO Reed Hastings and Peter Chernin sat down with New York Magazine’s John Heilemann to talk about the state of the video content business. A question from the audience asked Hastings about the news today that Hulu was cutting their prices.

Hastings noted that Hulu was still mainly an advertising play. And he said that Netflix has actually long been an advertiser on Hulu. “Hulu Plus may grow into a competitor over time, but that’s probably healthy for us,” he said. Notice he’s saying that he doesn’t consider them an actual competitor just yet.

He said that the space is growing so quickly and that there will be a lot of other players, not just the two of them.

Hastings also said that a streaming-only plan would be coming to the U.S. “shortly”. The service is currently offering such a plan in Canada.

When Heilemann asked him about further expansion, Hastings said that the plan is to be everywhere in 3 to 5 years — but said that the order they expand in doesn’t matter much. That will be dictated by the availability of broadband, he said.

Heilemann also asked Hastings if given Netflix’s fast growth, he worries about bandwidth problems going forward? Hastings noted that just 10 years ago the majority of the U.S. was accessing the Internet via AOL-type dial-up. Now we’re all on broadband. In 10 years, he envisions a world where we’ll have 100 Mbps upstream and downstream connections, and we’ll all be doing video conferencing in realtime.

It will follow Moore’s Law,” Hastings said noting that technology will keep coming along to make things faster. In other words, he’s not concerned about growth.


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