Longtime Netflix content chief Ted Sarandos has been named co-CEO alongside founder Reed Hastings, the streaming giant announced Thursday.
“Ted has been my partner for decades,” Hastings said in a statement announcing the appointment. “This change makes formal what was already informal — that Ted and I share the leadership of Netflix.”
Sarandos, 55, has worked at Netflix for more than two decades. He will continue to lead its content business as chief content officer and nothing about his day-to-day role is expected to change.
In a further shuffling of its executive team, Netflix said that chief product officer Greg Peters would add the title of chief operating officer. “We want Greg to help us stay aligned and effective as we grow so quickly around the world,” Hastings said.
The promotions are part of Hastings’ succession-planning process, he said in a blog post further detailing the change. A source close to the executive, 59, says he has no plans to immediately depart the business that he began building in the 1990s but that he’s thinking about its long-term roadmap, one that now puts the two veteran executives in strong contention to eventually succeed him.
On a post-earnings call for investors taped Thursday afternoon, Hastings confirmed that he is staying at Netflix for a while. “I’m in it for a decade,” he said.
The co-CEOS first met in 1999 after Hastings read an article in Video Business and asked a mutual friend to put them in touch, he outlined in the post. Sarandos added that he was at first “skeptical” about the business plan because “the internet was still so new and Netflix’s main competitor, Blockbuster, was huge and had completely disrupted the business model of my previous company.” But Hastings persisted and eventually convinced Sarandos to join the company.
Since then, Sarandos has been the key driver in Netflix’s fast expansion into all manner of entertainment programming, first in its accumulation of its vast streaming library and later leveraging his Hollywood relationships to bring it its first high-profile original, David Fincher’s 2013 drama adaptation House of Cards. In the past seven years, Netflix has methodically moved into new categories, from kids’ programming to documentaries to reality TV to Oscar-winning movies. It now releases hundreds of original film and TV titles each year, many of them produced for local audiences around the world.
“Ted’s been instrumental to our success as a company,” Hastings wrote. “While I saw streaming coming and pushed for it, Ted drove the revolution in our content strategy, which was way ahead of its time and has been key to our continued success. It was typical of his ability to see where the industry — and consumer tastes — are headed.”
The company’s lead independent director, Jay Hoag, added in a statement, “Having watched Reed and Ted work together for so long, the board and I are confident this is the right step to evolve Netflix’s management structure so that we can continue to best serve our members and shareholders for years to come.”
Peters, meanwhile, has spent more than a decade at Netflix and in his new role will work not just with the product team but across company divisions. “As we’ve grown, one of my biggest roles at Netflix has been to be broad across the company, getting to know many different people in every area of business,” Hastings wrote. “This has helped Netflix stay mostly aligned, loosely coupled and very productive. In his new role, I want Greg to take on more of this work so that we continue to improve rapidly.”
The news comes as Netflix continued its strong subscriber growth momentum. It added 10.09 million subscribers during its second quarter, boosting its global base to nearly 193 million. The company is expecting a softer second half of the year, however, forecasting just 2.5 million new subscribers during the third quarter, which sent its stock down more than 10 percent during after-hours trading.
