Netflix Has Freedom to Disrupt Content: Kirkpatrick

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Nov. 5 (Bloomberg) -- Bloomberg Contributing Editor David Kirkpatrick and Bloomberg View columnist William Cohan discuss how Netflix is using original content to build its brand and set the bar for online streaming. They speak on Bloomberg Television’s “Bloomberg Surveillance.”

Data and experiment tation.

It is an industry into molds increasingly.

-- ion tn tumolt.

Neither one is burdened by the traditional mindset.

They can do things in new ways.

They can use measurement to determine what to produce.

That is what amazon is doing.

That flick said to be taking more of a traditional approach and what it chooses to produce.

It knows who the customers are in a way that tv networks never could.

Apparently netflix uses that big day that two cast their shows.

The question is, how much do they spend on building the original shows and how much do they spend on gaining other shows from amc and others?

How do they strike the balance cap go they are spending billions.

This is a company we should talk about mixed to twitter the coast -- because it has a monumental market cap.

Not a clear long-term strategy.

One of their strategy is they are experimenting with a high resolution hd format.

Reed hastings talk about how to netflix was to be a big supplier of content.

They will be one of the pioneers of the new altra high definition.

I think it will model -- matter to some people in cement the reputation as being the lead in the industry.

What is the response to the rest of media?

I think they are were read they do not know how to respond.

Macs come on, they can go to l.a.. -- come on, they can go to l.a.. they have unbelievable technology savvy and data savvy, that for better or worse, the industry has not developed and cannot develop.

I think they are a very interesting company.

I wrote an article about them a couple of years ago.

I interviewed ted.

Right when they were developing "house of cards" i read the script and was impressed.

I was writing about them when their whole business model fell apart.

Shifting from dvd.

It is one of the more interesting business stories about how they have totally lost it.

Investors lost total confidence.

Carl icon sold out at 350. one of the more brilliant investing plays.

To have faith in that company when all about them were losing their heads.

Reed hastings one of the great minds in the industry.

He has proven himself to be that great leader.

A couple of years ago everyone was questioning him.

Good for him turning it around.

What they have done with the model is interesting.

It is a new dynamic between reed hastings and jeff a's those -- jeff bezos at amazon.

Amazon actually owns the content, netflix licenses it.

Amazon has the right to show advertisements, netflix does not.

That could be a long-term differentiator.

Bring up the chart again.

You can talk about the crash talking about dvd.

Here is the surge back.

Netflix, do i have to own it it f i am an institutional shareholder?

If you want to have the right cocktail party chat saturday night, you have to own them.

From a business point of view, another matter.

I think they are both highly valued, considering the long- term potential.

Also, the other companies who see the long-term potential are the cable operators.

This owns like comcast and other operators are negotiating from a position of weakness, but they feel they have to.

That is right.

They have to figure out how to get into this whole new way of distributing contact -- content.

Netflix is in the lead technologically.

Who was working the best of the old order television content with netflix you go i have a lot of admiration for comcast.

A new model certainly.

"orange is the new black" is the new one.

" aalpha house" is the new one.

Don't you want to see a show that terri trudell wrote and john goodman stars in?

They are outbidding hollywood.

They have a whole set of freedom accretive -- creative freedom that other companies lacked.

The first feature is the square.

A documentary about career square.

Who would expect they would go so high end?

-- tahirir square?

All you need is a computer and then a little longer and -- login.

Really?

They built a big ice scraper.

I had to turn the rabbit ears a little bit.

The big skyscraper in midtown.

I looked at it.

Ackman is like seven floors below.

Maybe it is time you start watching streaming video.

An ongoing conversation.

Coming up in the next hour, we will speak to arthur levitt.

You want to hear from this man after the record fine and admission of guilt at sac capital for insider trading.

That is coming bloomberg "surveillance." up in the next hour of bloomberg "surveillance." on bloomberg television, radio, and streaming at bloomberg.com.

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

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