Netflix CEO Ted Sarandos: Streaming Giant Is 'Both Classy and Massy' in India, and Iowa Is Watching

Netflix co-CEO Ted Sarandos says the streaming giant's success in India offers lessons for global entertainment, including for viewers in Iowa who might be surprised to find Bollywood movies in their queues. In a wide-ranging interview, Sarandos discussed the company's growth, its competition with other platforms, the role of artificial intelligence in filmmaking, and why he believes Netflix is both 'classy and massy.'

Ten years ago, Netflix had $6.3 billion in revenue and a $50 billion valuation. Today, it generates $45 billion in revenue with a $400 billion market cap. Sarandos credits this growth to a focus on personalization rather than production or distribution, a strategy that has made Netflix a dominant force in entertainment worldwide.

What is Netflix's secret sauce for success?

Sarandos says the company's differentiator has remained unchanged since its DVD-by-mail days: personalization. 'We're trying to find a movie you're going to love, not trying to trick you into pushing play,' he explained. 'That's actually quite bad for our business.'

This approach allows Netflix to serve diverse tastes, a lesson Sarandos says he learned from the company's early DVD business, which carried more than 100,000 titles. 'People's tastes are remarkably diverse,' he said. 'If you want to serve the world, you need something for everybody.'

How does Netflix compete for screen time?

Sarandos says Netflix competes for time on the living room screen, not necessarily on phones where viewers watch shorter, free content like YouTube. 'When you sit down, pick up the remote and push a button, we want it to be Netflix,' he said. 'We want to become the first place you check for something to watch and the last thing you'd ever cancel.'

He dismissed the idea that theaters are competition, noting that Netflix members watch about seven movies a month at home and one or two in theaters annually. 'It's a rich ecosystem,' he said.

What role does data play in Netflix's creative decisions?

Sarandos emphasized that data alone cannot drive creative success. 'There's no data in the world that could tell you to make this and don't make that,' he said. 'Data only tells you what worked before, and audiences are always looking for something they haven't seen.'

He pointed to 'Squid Game' as an example. 'No data would have said to make it, certainly not for a global audience,' Sarandos said. 'In hindsight, everyone says, of course it was amazing. But it was twice as expensive as any hour of Korean television ever produced.'

Why is India so important to Netflix's global strategy?

Sarandos says India represents a massive growth opportunity. 'With a population this size and an enormous appetite for entertainment, it's dramatically underscreened,' he said. 'There are fewer movie theatre screens per person than in almost any country in the world.'

Netflix has invested heavily in Indian content, bringing India its first Academy Award for 'The Elephant Whisperers' and producing hits like 'Sacred Games.' Sarandos noted that an Indian movie or series has appeared in Netflix's global Top 10 every week since 2024, with 3.5 billion hours of Indian content watched worldwide this year.

Is Netflix pursuing sports rights in India?

Sarandos said Netflix has a global live strategy that includes sports but does not include league sports. 'We've been fortunate enough to build a large business without a loss leader,' he said. 'It's very difficult to make money on league sports because they're expensive.'

He acknowledged that sports rights like the IPL could boost subscriber numbers but said Netflix does not want 'dependence on any one thing.'

How is Netflix using artificial intelligence?

Sarandos said Netflix has used AI tools in about 300 productions, primarily for pre-visualization and planning complex shots. 'It's been a game changer,' he said. 'But it has to make the story better, even better if it's faster and cheaper.'

He noted that Indian creators have embraced AI more aggressively than creators elsewhere. 'Indian storytellers get excited about the opportunity to bring ambitious projects to the screen when the resources aren't always there,' he said.

What did Sarandos say about the 'classy and massy' spectrum?

Sarandos said he loves the Indian phrase 'classy and massy,' which describes content ranging from highbrow to popular entertainment. 'I don't think consumers love their massy choice any less than they love their classy choice,' he said. 'In India, you've got people who really love Lock Upp. And then you've got something like Musafir Cafe, a deliberate love story with beautifully shot landscapes. They sit right next to each other, serving gigantic audiences.'

What is Netflix's approach to regulation and free speech?

Sarandos praised India as 'a beautiful working model for self-regulation' and said Netflix works closely with the government to follow guidelines without 'an onerous regulatory model.' He added, 'India has always been a phenomenal free speech culture.'

What advice does Sarandos have for business leaders on AI?

Sarandos advised CEOs to focus on specific use cases for AI rather than adopting it for its own sake. 'Don't get caught up in this idea that you just have to be an AI because that is where all the investment is going,' he said. 'It is important that people have a strategy of what they are going to use this tool for and how it will improve the business.'

Will Netflix consider acquiring other studios?

Sarandos said Netflix's growth model 'has been and continues to be organic growth.' He acknowledged that the company looked at Warner Bros Discovery but walked away when the price was no longer right. 'We have always been builders,' he said.

When asked which Warner Bros IP he would buy if given the chance, Sarandos chose 'Harry Potter.' 'If you think back to a franchise that has really stood the test of time, you probably have 20 that are legitimate and Harry Potter is certainly one of them,' he said.

This article is based on an interview conducted by The Indian Express.