Netflix and the Future: The Two Things Changing Your Favorite Streaming Platform
Netflix unloaded a bunch of news Tuesday at the TCA press tour about its massive slate of original programming, including release dates, show names and at least one season renewal. It also released some numbers: 34 Emmy nominations and plans to release 475 hours of original programming in the US this year. Which, when you consider how Netflix began in 2012 with just two original series to its name, is quite the achievement.
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The numbers Chief Content Officer Ted Sarandos rattled off weren’t the numbers that critics were hoping for — specifically, exact data about how many people actually watch Netflix programming. Sarandos even declined to state what Netflix original is the most-watched Netflix original, despite an earlier statement that morning that “Orange is the New Black” is one of the platform’s “most watched and most beloved shows.”
The reason for this, Sarandos said, was that to do so would imply that Netflix shows are in competition with each other, which isn’t the case. “It’s successful if it attracts that audience segments that we’re chasing,” he said before adding that audience segments are now as diverse as the series being offered.
And it’s a strategy that showrunners seem to be on board with given the conversation Tuesday afternoon during a panel featuring past, present and future creators who seem to be loving the Netflix experience. However, one element of no one knowing what kind of viewership they’re getting took an awkward turn in the showrunners panel, when creator Marta Kauffman was asked to compare her experience with “Grace and Frankie” to when the cast of “Friends,” in the 1990s, successfully leveraged their popularity to score massive salary hikes.
“It’s such a different situation,” she said. “The ratings are connected to advertisers, and that was the case, where the cast knew how valuable the show was to the network in terms of the advertisers. There are no advertisers on Netflix. And I think you’re hoping that I’ll say it’s frustrating, but the truth is, it’s wonderful, because there’s only one thing we’re doing. We’re not pandering to advertisers. We’re not pandering to a network. All we’re doing is making the show we want and that we believe in. If someday the cast says we’re worth more than you’re offering, then we’ll deal with it then.”
When asked how the cast might know if they’re worth more if they don’t know how many people are watching, Kauffman replied, “Because it’s not based on how many people [are watching] anymore. I don’t think that’s the issue, at least for us. How do they know? They know how good they are. They know how good the show is.”
Fact is, just the wide array of shows represented on that stage was eye-opening. As Kauffman said, “Each of us has a very specific road. And my road isn’t going to appeal to the audience that watches ‘Daredevil’ necessarily. And that’s okay. Because there are 65 million people. I don’t need all of them.”
Comparing the current Netflix slate to, say, its first real year of original programming is a striking contrast. In 2013, it was a lineup dominated by prestige dramas (ignoring “Hemlock Grove,” as per tradition/common sense). This year, there’s everything from stand-up specials to documentaries to the multi-camera sitcom. And not just any multi-cam, but the revival of classic ABC TGIF sitcom “Full House.” Sarandos said the first episode of “Fuller House” taped last week, and it was “very much in the same spirit of the original show.”
(If you really, really care, he also mentioned there’s opportunity for “stunt casting” with original series stars the Olson twins, but there’s no confirmation whatsoever that they’ll be involved.)
The audience Netflix is interested in there? Parents who watch TV with their kids, a relatively underserved market in the media landscape. That’s an audience Tina Fey is also interested in serving. Later in the day, in response to questions about whether or not NBC escapee “Unbreakable Kimmy Schmidt” would shift to a more adult rating now that it’s being made specifically for Netflix, Fey mentioned that she’d met people who were watching the show with their 12- or 13-year-olds. “I would hate to ruin that in Season 2,” she said.
But while Netflix was interested in the audience served by “Full House,” both in its heyday and in later syndication, he didn’t seem that interested in acquiring the rights to the original series. Why? Because Netflix has two watchwords right now: Exclusivity and control.
The best way to understand the current state of Netflix is to look at what Sarandos said about the fate of its first official original series, the often-forgotten “Lilyhammer,” starring Steven Van Zandt of “The Sopranos.” “Lilyhammer,” a co-production with Norwegian broadcaster NRK, is, as of Tuesday, officially dead after three seasons.
“We’re not going to continue with ‘Lilyhammer,'” Sarandos said to reporters after his time on stage at the TCAs. “It’s become a very economically challenged deal because there’s a partnership with the Norwegian broadcaster. It’s very difficult to maintain the exclusivity and control that we hope to with our shows.”
Sarandos also didn’t seem at all sad about the fact that it was Hulu that won the streaming rights to “Seinfeld” earlier this year, because for him, Hulu’s exclusive deal wasn’t all that “exclusive”: “I think that you see in the “Seinfeld” deal how complex exclusivity can be. So while that was a very rich deal, it’s remarkably not that exclusive. Those episodes are on TBS. They’re on‑demand on TBS. They’re on Crackle. So I think there’s a bunch of different holes in the exclusivity relative to the economics of that deal.”
The ultimate conclusion: The simplest path to exclusivity and control, Netflix seems to have decided, is to make the shows its own damn self.
The Netflix spin on why it wants true exclusivity and true control over its programming — the reason why it’s investing more and more money in original content — does have a consumer bent to it, specifically in the fact that if Netflix has complete control over the release strategy. It can guarantee its all-at-once policy that’s made binge-viewing into a lifestyle for so many. “The ultimate benefit of ‘all at once’ is consumer control; the size of the binge is determined by the watcher,” Sarandos said when asked to define a proper binge-viewing experience.
And he also pointed to another benefit of the Netflix approach: When Netflix has true exclusive rights to a show, it can release it internationally without any major issues. And distributing the show in all 41 global Netflix territories at the same time also has a notable decrease on piracy, according to Sarandos. “The piracy for U.S. television is enormous. It’s always talked about for movies, but in many parts of the world, U.S. television is stolen at a much greater rate than U.S. movies,” he said.
That said, Netflix is a business. And there’s no denying that, through smart investment and innovative strategizing, Netflix has become one of the most powerful players in the game in a very short window of time.
But while they do, they’re making some of the most creatively exciting television of recent years. Missteps happen, but no one plays a perfect game forever. And here’s what counts: We’re still watching.
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