How Netflix Is Changing the Media Landscape

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July 22 (Bloomberg) -- Netflix Co-Founder Mitch Lowe and Bloomberg's Jon Erlichman discuss the business of subscription based services with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

I think you heard what he said.

This is what they actually report.

Particularly the subscribers are in the united states.

They would add this during a little lower.

Some a little bit higher towards 800,000. they just fall within that range.

They are stealing -- seeing if the business continues to grow.

Given that reed hastings has been wondering if they would live the big shows put up a much bigger subscriber number.

Overall, they are at around 30 million subscribers here in the u.s.. i some accounts there holding a larger audience than hbo.

Their changing and a lot of ways the new media business.

Let me come to you.

At one point netflix was the biggest user of the u.s. postal service.

Today it is the biggest user of bandwidth on the internet.

Had to the company make that transition?

They follow the consumer.

The consumer assault dvd as the most logical and efficient way to get movies.

Today, with all the devices and people wanting more and more of the content where they want it, when they wanted in on the device they want, they migrated to being able to make those choices available.

Be one too many concepts, the idea that you can make one type of row graham and then distribute it to the many people that want it, is that is going to continue?

If you look at what netflix is doing, they have not made the full shift.

You can tell they are putting one leg over on the side with exclusive content.

If you look at the american household, they really are dividing into two groups.

They are willing to spend more and more money to get the right kind of content on the right device.

The other half of the households let are really looking to fill time.

They are looking for a dozen of shows that they are producing.

Exclusive to them are moving closer and closer to the side that is reaching out to consumers that are looking to spend more to get what they want.

They also know what consumers are way -- watching.

When does programming get run by an algorithm?

I think we are arty there.

I think that is an important point.

When people talk about the billions of dollars netflix is spinning on original content, when it comes to negotiating those deals in the old days, trying to figure out what something was worth was a lot more difficult.

If you're talking about television view would go by what the ratings were for past programs.

Netflix has a lot of proprietary data on was all users want.

If can afford to go to the table and pay a lot for something and maybe not so much for something else.

Displays incredibly importantly into what they are going to buy and make available.

It is not going to be everything you think.

This will not be the bitch budget shows even though they're spending a ton of money to keep the subscribers happy.

"orange is the new black" "house of cards" you know where i'm going with this.

This is spent on creating original program.

Is it really just down to the math that if they have 36 million subscribers spending eight dollars a month you do the math and you say that is over 3.5 billion dollars and they can afford it?

They can afford it.

When you look at the model that they are comparing themselves to, just look at hbo.

Hbo is collecting twice as much.

To aspire to that type of the print where they are spending more on this is close of content which means less on these tens of thousands of titles that they are now licensing, that is a great model.

Plus you have 100 million households that subscribe to hbo internationally.

That is a huge shift for netflix.

We just competed a route with some additional funding.

What we are really excited about is adding lots of celebrities and new contributors that will add a whole range of choices for our subscribers.

As she said, our contributor we just signed up a new woman, heather armstrong, who's considered the most successful mommy blogger in the country with millions of followers.

Describe to people what exactly such a celebrity would do.

You subscribe to a celebrity, someone that you admire and something you want to get closer to.

They design a package of goods or items that tell a story that they shipped you every three months.

It is a way to extend the fan base to get closer to people that you admire, whether they be writers or rap musicians like corel williams -- pharell williams.

Our hope is to expand to hundreds of choices so everybody will find someone they admire.

Or even jon erlichman.

I would sign up for that.

The idea of using celebrities , we know that has something that has always been going on in terms of trying to sell either a movie or project.

Now that you have a original programming, it you can actually something from kevin spacey to all of the fans.

Is there anything in the cards as to what is next for netflix?

It is an interesting point.

We are seeing interesting businesses that do more with celebrities, open sky, it retails.

Look.

I think platforms like twitter and facebook are popular because it is a way to connect with people and better gauge what they would like to see from them.

You are going to see a reach out from people embracing the new technologies.

They are choosing to do more of

This text has been automatically generated. It may not be 100% accurate.

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