Netflix CEO once handed out army berets to his execs in response to an insult from the former Time Warner boss, and it shows the rivalry between Netflix and HBO stretches over a decade

• Former Time Warner CEO Jeffrey Bewkes implied Netflix was overrated in a 2010 interview.
• A new book about HBO reveals that Netflix CEO Reed Hastings took the comments in stride.

The rivalry between Netflix and HBO stretches further back than the last few years of Emmy races.

A new book on the history of HBO, "It's Not TV: The Spectacular Rise, Revolution, and Future of HBO" by Felix Gillette and John Koblin, which Insider was provided a copy of before its release on Tuesday, offers new details on the decade-plus squabble.

In 2010, Jeffrey Bewkes — who was CEO of HBO's then-parent company Time Warner — took a jab at Netflix in a New York Times interview with the headline "Time Warner Views Netflix as a Fading Star."

"It's a little bit like, is the Albanian army going to take over the world?" Bewkes said. "I don't think so."

Reed Hastings, Netflix's current co-CEO and its sole chief exec at the time, took the comment in stride, according to Gillette and Koblin's book.

In a meeting with 70 of Netflix's top executives a few weeks after the Times interview dropped, Hastings handed out camouflage army berets that had an image of the Albanian flag's double-headed eagle on them.

Hastings used the meeting to "make fun of" Bewkes, former Netflix communications exec Jonathan Friedland told Gillette and Koblin, and took it as an opportunity for a pep rally of sorts. Insider was unable to find contact information for Bewkes to request comment on the book's passage.

A rivalry dating back more than a decade

The incident highlights the years-long back-and-forth between the streaming giant and premium cable network.

In recent years, Netflix and HBO have duked it out for Emmy domination, a TV industry status symbol. In 2020, Netflix finally prevailed in the ceremony's top honor of best drama series with "The Crown," but HBO took back the prize last year with "Succession."

But the rivalry goes deeper than mere trophies and signifies the rapid shifts in the entertainment industry.

When Netflix entered the original-series space a decade ago, one of its breakout series was "House of Cards" — a political drama that HBO had been eyeing. But Netflix offered $100 million for a two-season commitment, which was unheard of at the time, according to the book.

"We didn't have the financial flexibility to make that commitment," former HBO CEO Richard Plepler told the book's authors, Gillette and Koblin.

In 2013, the same year "House of Cards" premiered, Netflix's current co-CEO and content chief Ted Sarandos had told GQ, "The goal is to become HBO faster than HBO can become us."

When AT&T bought Time Warner in 2018, it made increasing HBO's content a priority for its streaming ambitions — which would be a change of pace from HBO's quality-over-quantity history and closer to Netflix's content strategy.

In other words, Netflix wanted to be more like HBO and HBO's corporate overlords wanted it to be more like Netflix. But a lot's changed.

Today, HBO is owned by Warner Bros. Discovery, the company formed this year when AT&T spun off Warner to Discovery. HBO's content chief, Casey Bloys, was recently elevated to CEO of HBO, HBO Max, and HBO Content. Max originals were intended to expand HBO's slate and typical demographics, but haven't tarnished the network's reputation. It's still an awards powerhouse (and a ratings one, given the success of "Game of Thrones" prequel "House of the Dragon").

Meanwhile, Netflix has faced headwinds this year, losing subscribers in the first two quarters. It avoided a third straight quarter of losses in Q3, and seems to be doubling down on what it thinks it does best.

So, HBO and Netflix aren't really becoming each other at all. Sure, Warner Bros. Discovery wants to succeed in the streaming space, but it doesn't seem to be betting it all on that like AT&T did. And Netflix is likely interested in HBO-like prestige, but still pumps out more content han any other entertainment company.