Netflix Inc. CEO Reed Hastings has some advice for media executives worried that his streaming service is stealing their viewers: Fix TV Everywhere.
TV Everywhere is the industry's attempt to keep pay-TV subscribers from leaving for streaming alternatives by letting them watch shows online when they want. Some analysts say the effort, spearheaded in 2009 by Time Warner and Comcast, has been slow to catch on with many customers. The service has been criticized for repetitive commercials and for not making multiple seasons available on demand. Viewers need to log in with their cable or satellite subscription passwords to access it.
"We've always been most scared of TV Everywhere as the most fundamental threat," Hastings said. "You get all this incredible content that the ecosystem presents on demand for your same $80 a month. Yet the inability of that ecosystem to execute on that, for a variety of reasons, has been troubling."
Some of the world's biggest media companies are adjusting their strategy after years of selling old seasons of shows exclusively to Netflix. Some are signing deals with other streaming-video providers like Hulu or making more episodes available on demand via traditional pay-TV distributors.
Investors have become concerned that TV producers might be jeopardizing long-term prospects for lucrative short-term deals with subscription video on-demand companies like Los Gatos, which have grown in popularity and taken viewers away from regular TV watching.
Despite "cord-cutting fears," in October pay-TV providers like Comcast, Time Warner Cable and Charter Communications reported video business results that exceeded analysts' estimates for the third quarter.
Hastings said he expects the number of pay-TV subscribers "will be relatively stable for a fairly long time" because TV programmers and distributors will eventually improve their on-demand services.
"When forced to act, they will improve," Hastings said.