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Netflix is doing to TV what steam-powered printing did to books

“The broadcast networks adapted to the expansion of cable networks very well,” Netflix CEO Reed Hastings said last week. “And that’s what we’ll see with cable networks: They’ll all become internet networks.”

He was speaking at a private conference hosted by Google in Arizona. Video of the Q&A session, which also included producer Brian Grazer, just went up online and was spotted by BTIG analyst Rich Greenfield (registration required).

The comment about cable networks becoming internet networks is interesting, in part, because Netflix recently began describing itself as a “network” for the first time. “We are a movie and TV series network,” it now says in the company’s “long-term view” document. The company’s preferred self-description used to be “internet TV app,” but Hastings clearly sees “network” as an equalizing term.

Hastings also used the interview to defend Netflix’s strategy of releasing full seasons of its original programming all at once, rather than one episode per week like traditional TV networks. Some think it hurts Netflix viewing and the amount of online chatter about the shows when people watch many episodes at once.

But Hastings said his customers don’t really do that.  “Occasionally they binge, and that makes a great story, but most of the time it’s just a single episode like you read the chapter of a book,” he said, drawing an analogy with the history of publishing.

Novels, he observed, were once published as serialized fiction in magazines. “And then book manufacturing got cheap enough where you could make a book and sell it at a reasonable cost,” Hastings said, referring to steam-powered printing presses that emerged in the 19th century. “And then people got control of all 13 chapters; they could read on their own schedule, and that greatly outcompeted the serialized release model of the then-historic magazines.”

You can watch Hastings’ full interview above. Here’s the meatiest passage (starting around 4 minutes into the video):

“Two hundred years ago, a lot of fiction was written for magazines. It was a serialized format for novels. And then book manufacturing got cheap enough where you could make a book and sell it at a reasonable cost. And then people got control of all 13 chapters; they could read on their own schedule, and that greatly outcompeted the serialized release model of the then-historic magazines.

“And I think we’ll see the same thing, which is: More and more, consumers want control. They want freedom. Occasionally they binge, and that makes a great story, but most of the time it’s just a single episode like you read the chapter of a book.

“And we’ll see chapters that are variable length. Like TV shows, instead of having 22 minutes for every episode, you can go with 30 minutes and 16, depending on the natural rhythms of the story.

“So I’m sure that will take off, and the major networks— Look, the broadcast networks adapted to the expansion of cable networks very well. And that’s what we’ll see with cable networks: They’ll all become internet networks. They’ll do a lot of these release patterns. Because it’s what consumers want. They want control, and they want to be able to watch things— They can watch more that way because they can watch on their own schedule.”

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