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| Netflix's Ted Sarandos: the 'evil genius' behind a TV revolution | Netflix's Ted Sarandos: the 'evil genius' behind a TV revolution |
| (about 17 hours later) | |
| Is Ted Sarandos a force for evil? It's a theory. Consider the evidence. Britain is already a country beset by various health-ruining, bank balance-depleting behaviours – binge-drinking, chain-smoking, overeating, watching football. Since January 2012 when Netflix launched its UK operation, Sarandos, its chief content officer, has created a new demographic of bingeing Britons –1.5 million subscribers who spend £5.99 a month to gorge on TV online. | Is Ted Sarandos a force for evil? It's a theory. Consider the evidence. Britain is already a country beset by various health-ruining, bank balance-depleting behaviours – binge-drinking, chain-smoking, overeating, watching football. Since January 2012 when Netflix launched its UK operation, Sarandos, its chief content officer, has created a new demographic of bingeing Britons –1.5 million subscribers who spend £5.99 a month to gorge on TV online. |
| To get a sense of what the 49-year-old Arizonan is doing to TV culture, imagine that you've just finished watching episode five of Joss Whedon's Firefly on your laptop, courtesy of Netflix. You've got places to go, people to meet. But up pops a little box on screen saying the next episode starts in 12 seconds. Five hours later, you dimly realise that you've forgotten to pick up your kids from school and/or your boss has texted you 12 times wondering if you're planning to show up today. | To get a sense of what the 49-year-old Arizonan is doing to TV culture, imagine that you've just finished watching episode five of Joss Whedon's Firefly on your laptop, courtesy of Netflix. You've got places to go, people to meet. But up pops a little box on screen saying the next episode starts in 12 seconds. Five hours later, you dimly realise that you've forgotten to pick up your kids from school and/or your boss has texted you 12 times wondering if you're planning to show up today. |
| Does he feel responsible for creating this binge culture, not just here but across the world (Netflix has 38 million subscribers in 40 countries, who watch about a billion hours of TV shows and films each month), I ask Sarandos when we meet in a London hotel? He laughs. "I love it when it happens that you just have to watch. It only takes that little bit of prodding." | |
| Sarandos feels it is legitimate to prod the audience so that they can get what they want. Or what he thinks they want. All 13 episodes of, say, political thriller House of Cards with Kevin Spacey, or the same number of prison comedy drama Orange is the New Black with Taylor Schilling, released in one great virtual lump. | Sarandos feels it is legitimate to prod the audience so that they can get what they want. Or what he thinks they want. All 13 episodes of, say, political thriller House of Cards with Kevin Spacey, or the same number of prison comedy drama Orange is the New Black with Taylor Schilling, released in one great virtual lump. |
| Why? "The television business is based on managed dissatisfaction. You're watching a great television show you're really wrapped up in? You might get 50 minutes of watching a week and then 18,000 minutes of waiting until the next episode comes along. I'd rather make it all about the joy." | Why? "The television business is based on managed dissatisfaction. You're watching a great television show you're really wrapped up in? You might get 50 minutes of watching a week and then 18,000 minutes of waiting until the next episode comes along. I'd rather make it all about the joy." |
| Sarandos says he got an intimation of the pleasures of binge-viewing as a teenager in Phoenix, Arizona. On Sundays in the mid-70s, he and his family would gather round the telly to watch Mary Hartman, Mary Hartman, a satire on soap operas. "If you worked, the only way could catch up with the five episodes they showed in the week was watching them back to back on Sunday night. So bingeing was already big in my subconscious." | Sarandos says he got an intimation of the pleasures of binge-viewing as a teenager in Phoenix, Arizona. On Sundays in the mid-70s, he and his family would gather round the telly to watch Mary Hartman, Mary Hartman, a satire on soap operas. "If you worked, the only way could catch up with the five episodes they showed in the week was watching them back to back on Sunday night. So bingeing was already big in my subconscious." |
| Years later, Sarandos binged again. "I really loved the Sopranos but didn't have HBO. So someone would send me tapes of the show with three or four episodes. I would watch one episode and go: 'Oh my God, I've got to watch one more.' I'd watch the whole tape and champ at the bit for the next one." | Years later, Sarandos binged again. "I really loved the Sopranos but didn't have HBO. So someone would send me tapes of the show with three or four episodes. I would watch one episode and go: 'Oh my God, I've got to watch one more.' I'd watch the whole tape and champ at the bit for the next one." |
| The TV revolution for which Sarandos and Netflix are responsible involves eliminating bit-champing and monetising instant gratification. Netflix has done well from that revolution: its reported net income was $29.5m for the quarter ending 30 June. Profits quintupled compared with the same period in 2012 – in part due to its new UK operation. | The TV revolution for which Sarandos and Netflix are responsible involves eliminating bit-champing and monetising instant gratification. Netflix has done well from that revolution: its reported net income was $29.5m for the quarter ending 30 June. Profits quintupled compared with the same period in 2012 – in part due to its new UK operation. |
| Sarandos hasn't done badly either. He and his wife, former US ambassador Nicole Avant, have a $5.4m Beverly Hills property and recently bought comedian David Spade's beachside Malibu home for $10.2m. Sarandos argues viewers have long been battling schedulers bent on stopping them seeing what they want, when they want. "Before time shifting, they would use VCRs to collect episodes and view them whenever they wanted. And, more importantly, in whatever doses they wanted. Then DVD box sets and later DVRs made that self-dosing even more sophisticated." | Sarandos hasn't done badly either. He and his wife, former US ambassador Nicole Avant, have a $5.4m Beverly Hills property and recently bought comedian David Spade's beachside Malibu home for $10.2m. Sarandos argues viewers have long been battling schedulers bent on stopping them seeing what they want, when they want. "Before time shifting, they would use VCRs to collect episodes and view them whenever they wanted. And, more importantly, in whatever doses they wanted. Then DVD box sets and later DVRs made that self-dosing even more sophisticated." |
| He began studying how viewers consumed TV while working part-time in a strip-mall video store in the early 1980s. By 30, he was an executive for a company supplying Blockbuster with videos. In 2000, he was hired by Netflix to develop its service posting rental DVDs to customers. "We saw that people would return those discs for TV series very quickly, given they had three hours of programming on them – more quickly than they would a movie. They wanted the next hit." | He began studying how viewers consumed TV while working part-time in a strip-mall video store in the early 1980s. By 30, he was an executive for a company supplying Blockbuster with videos. In 2000, he was hired by Netflix to develop its service posting rental DVDs to customers. "We saw that people would return those discs for TV series very quickly, given they had three hours of programming on them – more quickly than they would a movie. They wanted the next hit." |
| Netflix mutated from a DVD-by-post service to an on-demand internet network for films and TV series, and Sarandos found himself cutting deals with traditional TV networks to broadcast shows online a season after they were originally shown, instead of waiting for several years for them to be available for syndication. | Netflix mutated from a DVD-by-post service to an on-demand internet network for films and TV series, and Sarandos found himself cutting deals with traditional TV networks to broadcast shows online a season after they were originally shown, instead of waiting for several years for them to be available for syndication. |
| Thanks to Netflix and its competitors, the old TV set in the living room is becoming redundant. That living-room fixture has been replaced by a host of mobile surrogates – tablet, laptop, Xbox and even smart phone. | Thanks to Netflix and its competitors, the old TV set in the living room is becoming redundant. That living-room fixture has been replaced by a host of mobile surrogates – tablet, laptop, Xbox and even smart phone. |
| Were that all Sarandos had achieved, he would have been minor player in the idiot box revolution. But a couple of years ago, he decided Netflix should commission its own drama series and release them globally in season-sized bundles. In making that happen, he radically changed not just how but what we watch. | Were that all Sarandos had achieved, he would have been minor player in the idiot box revolution. But a couple of years ago, he decided Netflix should commission its own drama series and release them globally in season-sized bundles. In making that happen, he radically changed not just how but what we watch. |
| Why bother? "Up till a couple of years ago, a network would make every pilot for a series into a one-off show. I started getting worried, thinking nobody's going to make series any more, and so we wouldn't be able to buy them [for Netflix] a season after they've been broadcast. So we said maybe we should develop that muscle ourselves." Sarandos has a $2bn annual content budget, and spends as much as 10% on developing that muscle. | Why bother? "Up till a couple of years ago, a network would make every pilot for a series into a one-off show. I started getting worried, thinking nobody's going to make series any more, and so we wouldn't be able to buy them [for Netflix] a season after they've been broadcast. So we said maybe we should develop that muscle ourselves." Sarandos has a $2bn annual content budget, and spends as much as 10% on developing that muscle. |
| Strikingly, he didn't spend that money on movies, but TV. Why? "Movies are becoming more global, which is making them less intimate. If you make a movie for the world, you don't make it for any country. | Strikingly, he didn't spend that money on movies, but TV. Why? "Movies are becoming more global, which is making them less intimate. If you make a movie for the world, you don't make it for any country. |
| "I think television is going in the opposite direction – richer characterisation, denser storylines – and so much more like reading a novel. It is a golden age for TV, but only because the best writers and directors increasingly like to work outside Hollywood." Hence, perhaps, the successes of The Sopranos, The West Wing, The Wire, Downton Abbey, and by this time next year – he hopes – Netflix series such as the Wachowskis' sci-fi drama Sense 8. TV, if Sarandos has his way, is the new Hollywood. | "I think television is going in the opposite direction – richer characterisation, denser storylines – and so much more like reading a novel. It is a golden age for TV, but only because the best writers and directors increasingly like to work outside Hollywood." Hence, perhaps, the successes of The Sopranos, The West Wing, The Wire, Downton Abbey, and by this time next year – he hopes – Netflix series such as the Wachowskis' sci-fi drama Sense 8. TV, if Sarandos has his way, is the new Hollywood. |
| Netflix's first foray into original drama came only last year with Lilyhammer, in which Steve Van Zandt, who played mobster Silvio Dante in The Sopranos, reprised his gangster chops as Frank "The Fixer" Tagliano, a mobster starting a new life in Lillehammer, Norway. The whole season of eight episodes was released on Netflix at the same time, delighting those suffering withdrawal symptoms after the end of The Sopranos. A second season is soon to be released. | Netflix's first foray into original drama came only last year with Lilyhammer, in which Steve Van Zandt, who played mobster Silvio Dante in The Sopranos, reprised his gangster chops as Frank "The Fixer" Tagliano, a mobster starting a new life in Lillehammer, Norway. The whole season of eight episodes was released on Netflix at the same time, delighting those suffering withdrawal symptoms after the end of The Sopranos. A second season is soon to be released. |
| Sarandos suggests Lilyhammer points the way to a new globalised future for TV drama – more than a fifth of Norway's population watched the show. "It opened a world of possibilities – mainstream viewing of subtitled programming in the US and releasing in every language and every territory at the exact same moment. To me, that's what the future will be like." | Sarandos suggests Lilyhammer points the way to a new globalised future for TV drama – more than a fifth of Norway's population watched the show. "It opened a world of possibilities – mainstream viewing of subtitled programming in the US and releasing in every language and every territory at the exact same moment. To me, that's what the future will be like." |
| Sarandos also tore up another page of the TV rulebook, the one that says each episode of a series must be the same length. "If you watched Arrested Development [the sitcom he recommissioned in May, seven years after it last broadcast] none of those episodes has the same running time – some were 28 minutes, some 47 minutes. I'm saying take as much time as you need to tell the story well. You couldn't really do that on linear television because you have a grid, commercial breaks and the like." | Sarandos also tore up another page of the TV rulebook, the one that says each episode of a series must be the same length. "If you watched Arrested Development [the sitcom he recommissioned in May, seven years after it last broadcast] none of those episodes has the same running time – some were 28 minutes, some 47 minutes. I'm saying take as much time as you need to tell the story well. You couldn't really do that on linear television because you have a grid, commercial breaks and the like." |
| House of Cards, his second commissioned drama series whose first season was released in February, even better demonstrates Sarandos's diabolical genius (if that is what it is). He once described himself as "a human algorithm" for his ability, developed in that Phoenix strip mall, for recommending movies based on a customer's previous rentals. He did something similar when he commissioned House of Cards. | House of Cards, his second commissioned drama series whose first season was released in February, even better demonstrates Sarandos's diabolical genius (if that is what it is). He once described himself as "a human algorithm" for his ability, developed in that Phoenix strip mall, for recommending movies based on a customer's previous rentals. He did something similar when he commissioned House of Cards. |
| "It was generated by algorithm," Sarandos says, grinning. But he's not entirely joking. "I didn't use data to make the show, but I used data to determine the potential audience to a level of accuracy very few people can do." | "It was generated by algorithm," Sarandos says, grinning. But he's not entirely joking. "I didn't use data to make the show, but I used data to determine the potential audience to a level of accuracy very few people can do." |
| It worked like this. In 2011, he learned that Hollywood director David Fincher, then working on his movie adaptation of The Girl with the Dragon Tattoo, was pitching his first TV series. Based on a script by Oscar-nominated writer Beau Willimon, it was to be a remake the 1990 BBC series House of Cards, and would star Kevin Spacey as an amoral US senator. | It worked like this. In 2011, he learned that Hollywood director David Fincher, then working on his movie adaptation of The Girl with the Dragon Tattoo, was pitching his first TV series. Based on a script by Oscar-nominated writer Beau Willimon, it was to be a remake the 1990 BBC series House of Cards, and would star Kevin Spacey as an amoral US senator. |
| Some networks were sceptical, but Sarandos – not least because he's a political junkie who loves political thrillers and, along with his wife, helped raise nearly $700m for Obama's re-election campaign – was tempted. He unleashed his spreadsheets, using Netflix data to determine how many subscribers watched political dramas such as The West Wing or the original House of Cards. | Some networks were sceptical, but Sarandos – not least because he's a political junkie who loves political thrillers and, along with his wife, helped raise nearly $700m for Obama's re-election campaign – was tempted. He unleashed his spreadsheets, using Netflix data to determine how many subscribers watched political dramas such as The West Wing or the original House of Cards. |
| "We've been collecting data for a long time. It showed how many Netflix members love The West Wing and the original House of Cards. It also showed who loved David Fincher's films and Kevin Spacey's." | "We've been collecting data for a long time. It showed how many Netflix members love The West Wing and the original House of Cards. It also showed who loved David Fincher's films and Kevin Spacey's." |
| Armed with this data, Sarandos made the biggest gamble of his life. He went to David Fincher's West Hollywood office and announced he wanted to spend $100m on not one, but two 13-part seasons of House of Cards. Based on his calculations, he says: "I felt that sounded like a pretty safe bet." | Armed with this data, Sarandos made the biggest gamble of his life. He went to David Fincher's West Hollywood office and announced he wanted to spend $100m on not one, but two 13-part seasons of House of Cards. Based on his calculations, he says: "I felt that sounded like a pretty safe bet." |
| But was it? What if season one had been a turkey? He'd already paid for season two (which has just finished filming). Also, what defines success? Netflix is notorious for not publishing overnight ratings for shows, arguing that this is inimical to making quality TV. "The longer people watch Netflix and the longer they stay members – they're the criteria of success for us," he says. Another criterion perhaps is awards: House of Cards just won two Emmys – a first for an internet-only series and vindication, you might think, of Sarandos's commissioning skills. | |
| Recently it was revealed that he had green-lit the second season of Orange is the New Black before the first one had been released. "Normally when you make that decision you haven't seen the whole season, but we'd already seen the first 13 episodes." So you were commissioning the second season based on your own taste? "No. It was based on our confidence that our modelling was right." | Recently it was revealed that he had green-lit the second season of Orange is the New Black before the first one had been released. "Normally when you make that decision you haven't seen the whole season, but we'd already seen the first 13 episodes." So you were commissioning the second season based on your own taste? "No. It was based on our confidence that our modelling was right." |
| He reckons his taste-based alogorithmic modellings are more sophisticated than those used by other online businesses that encourage users to buy products on the basis of past purchases. "When you go to Amazon they don't know if you bought a book for a friend, they don't know if you've read it, and so their recommendations are screwy. I've had the experience where I bought a book about cancer for a friend whose mother had it, and for the next six months that's all I got: cancer books. | He reckons his taste-based alogorithmic modellings are more sophisticated than those used by other online businesses that encourage users to buy products on the basis of past purchases. "When you go to Amazon they don't know if you bought a book for a friend, they don't know if you've read it, and so their recommendations are screwy. I've had the experience where I bought a book about cancer for a friend whose mother had it, and for the next six months that's all I got: cancer books. |
| "The failing of those systems is they don't have enough inputs to give you a decent output. We do. That's how we make our money." | "The failing of those systems is they don't have enough inputs to give you a decent output. We do. That's how we make our money." |
| There have been a few casualties in Sarandos's lucrative TV revolution. One is the erstwhile holy grail of TV commissioning editors the world over – the watercooler moment.In the past, TV success was measured by two things: ratings and the extent to which a show became a talking point. Thanks to the arrival of multi-channel TV, followed by online video services such as Netflix, LoveFilm, Blinkbox, 4OD and Sky Go, that second measure became irrelevant. During his lecture at the Edinburgh TV festival last month, Kevin Spacey said: "The watercooler moment has vanished." | There have been a few casualties in Sarandos's lucrative TV revolution. One is the erstwhile holy grail of TV commissioning editors the world over – the watercooler moment.In the past, TV success was measured by two things: ratings and the extent to which a show became a talking point. Thanks to the arrival of multi-channel TV, followed by online video services such as Netflix, LoveFilm, Blinkbox, 4OD and Sky Go, that second measure became irrelevant. During his lecture at the Edinburgh TV festival last month, Kevin Spacey said: "The watercooler moment has vanished." |
| Does Sarandos go along with that? "I think it's mostly dead. There are certain things that you can watch together and have a collective moment. Who won the talent competition, who won the soccer match … Those are the things that are uniquely attuned to traditional television. It's very different for professional, scripted television. | Does Sarandos go along with that? "I think it's mostly dead. There are certain things that you can watch together and have a collective moment. Who won the talent competition, who won the soccer match … Those are the things that are uniquely attuned to traditional television. It's very different for professional, scripted television. |
| "I think the downside to creating watercooler moments for television is you create that artificial moment and leave people hanging. And then you need to lure them back for the next week and hope that they're still buzzing about it." Think of the dum-dum da-da-da-dah of EastEnders' closing titles music, telling us we'd better come back next time to find out how the storyline will be resolved. Dickens and Wilkie Collins were pulling the same narrative stunts in Victorian serial literature, but, for Sarandos, such devices are inimical to good storytelling. | "I think the downside to creating watercooler moments for television is you create that artificial moment and leave people hanging. And then you need to lure them back for the next week and hope that they're still buzzing about it." Think of the dum-dum da-da-da-dah of EastEnders' closing titles music, telling us we'd better come back next time to find out how the storyline will be resolved. Dickens and Wilkie Collins were pulling the same narrative stunts in Victorian serial literature, but, for Sarandos, such devices are inimical to good storytelling. |
| "Those cliffhangers usually have such a little pay-off in the next episode. They're cheap tricks." He contrasts them with the end of the second episode of House of Cards. "[Spacey's character] is just working out on a rowing machine. He's not in jeopardy. Instead of being tricked into episode three, I'm coming back because I got to know him and I want to know him more." | "Those cliffhangers usually have such a little pay-off in the next episode. They're cheap tricks." He contrasts them with the end of the second episode of House of Cards. "[Spacey's character] is just working out on a rowing machine. He's not in jeopardy. Instead of being tricked into episode three, I'm coming back because I got to know him and I want to know him more." |
| What will TV look like in the next decade? Will Netflix make traditional TV channels obsolete? "Broadcast TV will become more event-based. When I was growing up, on Friday nights Evel Knievel would be jumping things and we'd be waiting to see if he died. Just a couple of weeks ago, Discovery broadcast the guy tightrope-walking across the Grand Canyon and they got their biggest ever ratings. TV is going back to its event roots." | What will TV look like in the next decade? Will Netflix make traditional TV channels obsolete? "Broadcast TV will become more event-based. When I was growing up, on Friday nights Evel Knievel would be jumping things and we'd be waiting to see if he died. Just a couple of weeks ago, Discovery broadcast the guy tightrope-walking across the Grand Canyon and they got their biggest ever ratings. TV is going back to its event roots." |
| Perhaps, but arguably watercooler telly isn't quite dead. Consider, say, ITV's Broadchurch, with its 11 million viewers coming back week after week for another episode, and front-page coverage given to the fictional culprit's identity – an old-fashioned, collective experience, a weekly talking point, even in this multi-channel, time-shifted, online broadcasting culture. | Perhaps, but arguably watercooler telly isn't quite dead. Consider, say, ITV's Broadchurch, with its 11 million viewers coming back week after week for another episode, and front-page coverage given to the fictional culprit's identity – an old-fashioned, collective experience, a weekly talking point, even in this multi-channel, time-shifted, online broadcasting culture. |
| To clinch the point, consider one of Netflix's great recent successes in the UK, Breaking Bad, the drama series of an Albuquerque chemistry teacher turned sociopathic crystal meth cook. Thanks to the vagaries of global broadcasting rights, Netflix streamed the final series' episodes in the UK a day after their US broadcast. "Our strategy is generally to get everything as quickly as possible to the whole world. In the future, that's what TV will be like." But not today, when people were forced to wait for their weekly fix, tweeting and retweeting questions around the world: can Jesse save Andrea and little Brock by cooking meth for those brutish hoods? Can Walt elude the DEA forever? What was the deal with the ricin? This, then, is the global, virtual equivalent of watercooler TV. | To clinch the point, consider one of Netflix's great recent successes in the UK, Breaking Bad, the drama series of an Albuquerque chemistry teacher turned sociopathic crystal meth cook. Thanks to the vagaries of global broadcasting rights, Netflix streamed the final series' episodes in the UK a day after their US broadcast. "Our strategy is generally to get everything as quickly as possible to the whole world. In the future, that's what TV will be like." But not today, when people were forced to wait for their weekly fix, tweeting and retweeting questions around the world: can Jesse save Andrea and little Brock by cooking meth for those brutish hoods? Can Walt elude the DEA forever? What was the deal with the ricin? This, then, is the global, virtual equivalent of watercooler TV. |
| In exporting its TV revolution beyond US borders, Netflix is taking on not just traditional broadcasters, and not just online competitors such as LoveFilm and Blinkbox (not to mention Amazon's Prime Instant Video subscription service and YouTube film streaming), but illegal services. Why do so many pirate BitTorrent sites thrive? "Because people are frustrated. In Scandinavia and the Netherlands, they have the fastest internet in the world and they're waiting one or two years to watch US shows. What do you think they're going to do? | In exporting its TV revolution beyond US borders, Netflix is taking on not just traditional broadcasters, and not just online competitors such as LoveFilm and Blinkbox (not to mention Amazon's Prime Instant Video subscription service and YouTube film streaming), but illegal services. Why do so many pirate BitTorrent sites thrive? "Because people are frustrated. In Scandinavia and the Netherlands, they have the fastest internet in the world and they're waiting one or two years to watch US shows. What do you think they're going to do? |
| "The internet is a great international distribution tool, but it's also a marketing tool. So if you're going to market something to people and then not give it to them, you're asking for trouble. You're asking for piracy." | "The internet is a great international distribution tool, but it's also a marketing tool. So if you're going to market something to people and then not give it to them, you're asking for trouble. You're asking for piracy." |
| Time for photos, but not before Sarandos adds: "TV's very different from when you and I were kids. People have always been frustrated when they can't get to see what they want. Today you can't stop spreading the joy for long. That's where I come in." | Time for photos, but not before Sarandos adds: "TV's very different from when you and I were kids. People have always been frustrated when they can't get to see what they want. Today you can't stop spreading the joy for long. That's where I come in." |
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