Efe Çakarel: VoD has huge potential but competing with Netflix is not the way to succeed

Efe Çakarel founded MUBI in 2007, after he discovered that he couldn’t watch Wong Kar-wai’s In the Mood for Love in a café in Tokyo.

That spurred him to create a company that hand picks what it considers to be the best films within a particular region, and makes them available to subscribers in 200 territories globally.  

Speaking before his two IBC Conference sessions ‘Is the Future of Video Vertically Integrated?’ and ‘Online Platforms Evolve, Becoming (Closer to) TV’, the Turkish-born entrepreneur explains that his company’s challenge is to “figure out what is the right consumer experience. In a world where Netflix and Amazon exist, how do people like us differentiate ourselves meaningfully?”

Creating differentiation

It’s a complex issue that will take time to resolve. But Çakarel is very clear on one point: he is not planning to create a new Netflix.

“I am not competing with them. I am completing the experience with a very focused offering,” he says. “It’s crazy to do exactly what Netflix is doing now and have any hope of winning.

”I am still trying to understand what they are doing and how we can differentiate ourselves. The market is so big; if we have the right strategy then we can create a good place for ourselves.”

The Stanford and MIT graduate adds that the video-on-demand and streaming video sector has a great deal to learn and he believes it is still very much in the early stages of its development.

“VoD has existed since early 2000, and it has been so slow to develop. But everything started to happen about three years ago,” he comments. “This market is not even close to maturity.”

“This market is not even close to maturity”

As Çakarel told the IBC Conference audience, he is interested in exploring how to provide the best content experience for users, and whether that means creating original content, or simply distributing the film and TV content from the more traditional production companies and studios.

“I would like a meaningful discussion on what is the right value proposition for users in terms of original and other content,” he adds. “What do consumers really want? That is an important point.”

Global variations

A further challenge is to determine the right strategy for each market. 

“Every market has its own different flavours. Turkey, for example, has about 30 million people below the age of 30, but it also benefits from a very strong free TV market. But in the UK, there is a smaller share of free TV, and that makes it a very exciting market,” Çakarel says, implying UK consumers might be less resistant to new paid-for services.

Working in partnership

As things stand, MUBI has made good use of partnerships to expand its business. For example, Çakarel cites a joint venture with Sony Computer Entertainment that has enabled the company to distribute its services in 58 countries. MUBI also has a global partnership with Samsung for a presence on its Smart TV user interface.

“We are all trying to provide a good consumer experience,” he says. He is also very bullish on Netflix and Amazon, because of what they have achieved to date. 

“However, I am focused on creating a business that has a higher return on investment than Netflix. I want to create a profitable business with a strong focus on ROI and not just size of revenue,” he concludes.

This interview was first conducted for IBC2016.