Ted Sarandos made a surprise appearance at last night’s Canal+ content showcase. Having been showered with praise for the streamer’s impact in France, he shed more light on Netflix‘s plans for Warner Bros.’s theatrical releasing if that deal goes through.
Maxime Saada, Canal+ Chair and CEO, who has been a consistent supporter of Netflix’s management and strategy, said the streamer had been “very good” for his company. Netflix launched in France in September 14 to a hostile audience who culturally were more inclined to watch free-TV channels or go to the cinema.
“Before you showed up, we had approximately 30% of French people willing to pay [to watch] TV,” said Saada. “Netflix showed up in France with your proposition and user experience, and you convinced the French to pay, and now the penetration of paid television is 75%. You have basically doubled the market size in France, so thank you for that.”
Sarandos responded that Netflix knew it “had to make television worth paying for” and “good enough that consumers would be glad to pay for it.”
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Theatrical commitment
Sarandos was asked about the rationale for buying Warner Bros. for $83B, and he chose to respond by outlining where Netflix lacked as an entertainment operation and once again confirming Netflix’s commitment to releasing studio movies in the cinema.
“It’s hard to imagine we’ve only been doing original programming for 12 years,” he said. “We’ve been moving very fast, building a library as fast as we can. We have made everything we have greenlit so it’s not a very deep development pool. Our library only extends back a decade whereas Warner Bros. stretches back a hundred years. They know a lot about things we haven’t ever done like theatrical distribution.
“Our intentions when we buy Warner Bros. will be to continue to release Warner Bros, studio movies in theaters with the traditional windows. Those movies will flow through the Canal+ output deal. We never got into it before because we never owned a theatrical distribution mechanism. We were monetizing movies through our own subscription because that’s how we were growing the business the fastest.”
In France, theatrical releasing rules are complex, with Netflix and Canal+ among those whio have sought to reduce long windows that hold theatrical movies back from TV screens. Currently, Netflix has to wait 15 months before it can stream films in the country.
Saada questioned whether Netflix would continue its relationship with Canal+ post the Warner deal, which he described as “80% partners and maybe 20% competitors” – particularly in terms of sports rights.
Sarandos responded that Netflix would only compete for “eventized” and “specialized” sports such as the upcoming Anthony Joshua vs Jake Paul boxing match or Christmas Day American football. “Our primary mission is film and television,” said Sarandos. “I don’t see us flipping from 80-20 to 20-80.”
Netflix is battling out to acquire Warner with Paramount also interested via a hostile takeover bid. The Financial Times reported this morning that Warner is set to rebuff Paramount’s offer.