Obama's $500,000 Power Couple
Under Sarandos' watch, Netflix has become an increasingly important portal through which Hollywood's product can reach audiences.
"Our original-content strategy is driven by a belief that networks and cable channels will evolve to be more like web channels," says Sarandos, known for his low-key personal style. "If that turns out to be true, they will want to monetize their content themselves and be less likely to license their content to us. Look at HBO Go. I want to get good at original programming before they get good at direct-to-consumer relationships, delivery technology, device distribution, encoding and personalized user interface. … Between those two, I think I have the easier list of things to tackle."
As is often the case with digital innovators, it's unclear to many whether Netflix's impact on the distribution of Hollywood product will be constructively transformational or dislocatingly revolutionary. "Everyone was worried about how these things would interact with each other," Sarandos says, "but when any kind of entertainment technology takes hold, it always expands the pie, and people are willing to spend more time and money on entertainment if it's good. But the great proof point was YouTube. For me, that was like the 'aha moment.' It had to be click-and-watch, simple, and that's how we built the Netflix product."
Fox chief Jim Gianopulos, whose response to Obama's stand on SOPA was one of the most sharply negative among studio executives, says he considers Sarandos a close friend. "He is the one that's driving Netflix's migration to the Internet," Gianopulos says. "Ted and Netflix are a bridge to bring the tech community and the content community together. Allowing piracy to run rampant would undermine their very existence."
Says Sarandos: "We have to craft a solution that Silicon Valley and Hollywood can come together over. I always feel like the studios get a bad rap about being technophobes, but how can you say that about the guys who are making Avatar?"
Still, he tells studio execs: "Look, if Silicon Valley crafted a censorship bill, and you had no input, the first thing you'd try to do is kill it. So let's come together and figure out the answer. I think holding the president accountable for the bad drafting of SOPA is not productive. He is supportive of Hollywood on piracy; he just wasn't on SOPA, and we need to do a better job of distinguishing those things from one another."
Despite SOPA's failure, says Gianopulos, "All my closest friends want to do everything we can to make sure our president gets re-elected."
Gianopulos isn't the only one to mix politics and business with Sarandos. Last summer, Saban and Sarandos worked out a deal that made all 700-plus episodes of Saban's Power Rangers franchise available for streaming on Netflix. "They are innovative, aggressive content creators," says Saban. "I don't know anybody who doesn't want to work with Netflix."
On Feb. 21, The Weinstein Co. announced a multiyear deal to make many of its titles (including best picture Oscar winner The Artist) available exclusively on Netflix after their theatrical runs and DVD releases. Separately, Avant and Sarandos are talking with Harvey Weinstein about joining to hold a New York event for Obama. "I'd love to do something with Ted and Nicole," says Weinstein, who has bundled more than $500,000 for the president this election cycle.
When Avant returned from her Bahamas post, many assumed she would pick up where she had left off after the 2008 campaign. Four years ago, Avant was involved in every major Southern California fund-raiser, including the $9 million Barbra Streisand concert and Greystone Mansion dinner and the gathering at Oprah Winfrey's Montecito, Calif., estate.
"She broke new ground, raising money from areas of L.A. that were previously neglected," says Matthew Barzun, national finance chairman for Obama's re-election campaign. "She was a huge source of energy and a charismatic leader."
Says Avant: "I went for the people who had been overlooked. I didn't want it to be just about the entertainment industry. I sought out businesspeople, lawyers, investors, artists, philanthropists -- anyone who wanted to be involved."