Netflix co-CEO Reed Hastings told CNBC that the streaming giant has not in recent years tried to gain access to the Chinese market, focusing instead on growth opportunities presented elsewhere around the globe.
“We got turned down by the Chinese government several years ago. And we have not been spending any time on China in the last couple years,” Hastings said in interview with CNBC’s Andrew Ross Sorkin that aired Wednesday on “Squawk Box.”
“There’s so much opportunity for us in Asia, the rest of Asia — India, in particular, Korea, Japan, Indonesia, and then all through Europe and Latin America,” Hastings said.
International subscribers have been key to Netflix’s growth strategy and closely followed by Wall Street investors. As of 2014, Netflix was streaming in more than 40 countries. Now, it is available in over 190 — but China is not one.
China, as the world’s second-largest economy, is viewed as a key market for many American businesses such as Apple. However, tensions between the U.S. and China have become increasingly tense under the administration of President Donald Trump, who most recently has focused his ire on Chinese tech firms that he claims represent a national security risk.
Trump, in particular, has taken steps to to restrict access in the U.S. to TikTok, the popular video social media app owned by Chinese tech firm ByteDance. In its July earnings report, Netflix began to count TikTok as one of its competitors. TikTok has denied claims that it poses a national security risk to U.S.-based users.
The U.S. and China have also engaged in a contentious trade war that saw the two countries implement billions of dollars of import tariffs on each other’s goods before reaching a “phase one” trade deal earlier this year.
Hastings, who co-founded Netflix in 1997, lamented the frostiness of the relationship between the U.S. and China.
“It’s a pity from a long-term perspective of the U.S. and Chinese disengagement,” he said. “But there’s nothing we can do about that. And instead, we’re focusing on entertaining everybody else.”
A Global Asset Management Seoul Korea Magazine