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Something about me? I have been a nerdy cinephile for as long as I can remember. Putting the two together is living my best life. That notwithstanding, I was born to express, not to impress, so I blog because I don't have friends. In other news, I like hashtags because they look like waffles, prefer my puns intended, and I always give 100% unless I'm donating blood. Thanks for reading.
Netflix is up to something, and it will affect you. The streamer appears to go against its word and prepares to offer a less expensive, ad-supported platform on November 1st. Big Red is still the king of the streaming mountain with 221 million subs. Yet, coming up on their left, here comes Mickey Mouse with its 152 million geeks. That lost ground caused Netflix CEO Reed Hastings with some sleepless nights.
Disney+ offers a bundle package, owns part of Hulu, and carries three of the largest movie studios in the world (i.e., Pixar, Marvel, Lucasfilm). Netflix has a dazzling array of content. However, this one platform with one price thing doesn’t help fleece its subscribers…eh, creates more options. So, what’s a streamer to do? Monetization!
If Hastings offers a freemium SVOD model, the focus leaves the subscribers. Why? While you pay a monthly fee, advertisers pay much more. That’s going to commit subscribers to an endangered species. Don’t believe what you’re reading? Well, binge this…
Show Netflix the Money
An analyst report from Puck News unveiled Reed Hastings’ plans for global streaming domination. True to his word, Hastings has long been the advocate of the viewer. This past June, Peter Friedlander, a Netflix muckety-muck for UCAN Scripted Shows (that’s the US and Canada), said something of interest at a Hollywood Radio Television Society event:
We fundamentally believe that we want to give our members the choice in how they view. And so giving them that option on these scripted series to watch as much as they want to watch when they watch it, is still fundamental to what we want to provide. And so when you see something like a batched season with Stranger Things, this is our attempt at making sure we can get shows out quicker to the members.
Yeah. That’s sweet. But y’all would choose to make money, so members can take a back seat.
Puck opines that Hastings “has seemed unwilling to pivot off the binge model because he hasn’t needed or wanted to. Now, it appears, he does.” Think about it: The big tentpole releases of The Sandman, Stranger Things, Ozark, and some of their massively hyped documentaries all show up at once. That’s big fun for a weekend butt plant on the couch.
One problem: If you aren’t already a subscriber, you can trial run Netflix, watch the entire series, stay caught up with water cooler chats, and turn off the streamer. What do they care? You got what you needed, and they won’t miss your $14.99 for the coming months. Well, they care, not about you, though. It’s that lost revenue.
The End of the Innocence
You may not be a math savant, but the truth to what Reed Hastings is thinking is all inside the numbers.
Let’s say you get four commercials per hour on a season drop with eight episodes. That’s 32 commercials. But, if you have the freemium, ad-supported model, that’s two to three ads every 20 minutes. We call that multiplication at 72 commercials.
See? If you pay less for Netflix, you’re making the streamer more money. Good on ya’.
When Hastings announced the ad-friendly format during an April quarterly call, he called it “an exciting opportunity.” Sure it is. But about that spin control, Reed? You’re making us dizzy.
Those who have followed Netflix know that I have been against the complexity of advertising and a big fan of the simplicity of subscription. But as much as I am a fan of that, I am a bigger fan of consumer choice. And allowing consumers who would like to have a lower price, and are advertising-tolerant get what they want, makes a lot of sense.
Yeah, thanks for the dedication to the rest of schmucks, boss. So…could Netflix put its subscribers in the rearview and destroy the binge model? Stranger Things have happened.
Something about me? I have been a nerdy cinephile for as long as I can remember. Putting the two together is living my best life. That notwithstanding, I was born to express, not to impress, so I blog because I don't have friends. In other news, I like hashtags because they look like waffles, prefer my puns intended, and I always give 100% unless I'm donating blood. Thanks for reading.
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