Netflix CEO calls Amazon Prime Instant Video a 'confusing mess,' defends pricing

26th Sep 2012 | 22:11

Netflix CEO calls Amazon Prime Instant Video a 'confusing mess,' defends pricing

CEO prefers Netflix's algorithms

Something tells us that Reed Hastings isn't going to renew his Amazon Prime membership. The outspoken Netflix CEO described Amazon's Instant Video service as a "confusing mess."

"[Amazon has its Prime membership service] and it's really about low-cost shipping, but why is video in there? It's kind of a confusing mess," Hastings told the Wall Street Journal.

By comparison, Netflix solely focuses on video. Algorithms that inform users of what content they might enjoy are at the heart of why the company does a better job, according to Hastings.

For this reason, he puts both Amazon and Hulu on the lower end of his favorite video services queue.

Netflix pricing scheme defended

Hastings also defended Netflix's higher price in the same interview, and he did it with another knock on what Amazon has to offer.

"In the U.S., our content budget is about three times [Amazon's], and we've got about three times more content. And what our customers tell us is they want Netflix to have more content, not to have two-thirds less at a lower price."

Netflix's unlimited streaming plan is $7.99 a month, while Amazon charges $79 a year for Prime. That comes out to $6.53 a month and includes perks like free two-day shipping, $3.99 one-day shipping and a Kindle Owners' Lending Library.

The future of Netflix

The good news for current Netflix customers is that they shouldn't see a price increase or a tiered plan any time soon.

"Our fundamental view is we grow revenue by expanding the number of members, rather than increasing the pricing," Hastings told the WSJ. "We want Netflix to be a very simple experience: one price, a clean proposition."

Hastings also dismissed pay-per-view, ad-supported video like Hulu Plus and downloading and storing content. He called selling content to users "too complicated."

Instead, the Netflix CEO expects to win back customers by exclusively streaming season four of Arrested Development. The company has a total of five original programs scheduled for 2013.

Netflix's stock price, down 79.86 percent since its peak last year, made a modest recovery today. It gained 2.47 percent at the close of the trading day.

Via WSJ, CNET

Netflix CEO Reed Hastings Hastings Amazon Amazon Prime Amazon Instant Video Hulu Hulu Plus Arrested Development streaming video on demand
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