Out with Subs, in with Content Engagement

Welcome to The Kids StreamerSphere, a regular newsletter where we look at the latest news, deals, and performance data for kids content within the context of global streaming. Comments, questions, suggestions? Please hit me up [email protected]. If you would like this newsletter delivered straight to your inbox, you can sign up on Substack here:

https://thekidsstreamersphere.substack.com

Netflix earnings hit earlier this week and my key takeaway was that the failure of animated feature Spellboundwas in no way addressed or acknowledged. I wrote that up as immediate reaction a few days ago. Now this newsletter is dedicated to the standard takeaways I usually highlight for kids media.

Key Headlines:?

No more subscriber disclosures… Q4 2024 marks the final time Netflix are going to disclose subscriber growth as a key metric. They went out with a bang(!) at +18.9?million. This is the biggest quarterly net add ever. Nice work, Netflix! The focus away from subscribers is tactical AF of course. Home market penetration in the US is pretty saturated at this stage, and they’ve also been in all major markets for a number of years. On that basis, a consistent growth story coming from reporting subscribers in the future is going to get more and more tricky. If there’s ever a one-off jump, they can always do an ad hoc update. So what are they going to use to juice Wall Street going forward? Well, beyond financial growth, the focus will be content performance updates, which is wonderful for the purposes of this newsletter. Netflix have been saying for a few years now that the story on content engagement is something they see as central to the success of their platform. And it’s not just talk; they’ve consistently acted. In the past five years they’ve disclosed more and more about content performance, culminating in the six-monthly engagement DUMPs. With that in mind, I’d say it’s fair to expect even more details on what’s hot (and by analysis what’s not) to come from the streamer in 2025. What a fun time to be working on a project that keeps its finger on the pulse of any data disclosure Netflix circulate as regards kids content!

Sports did good, but the focus is on “live event programming”… Between Jake Paul vs. Mike Tyson, NFL games and WWE you’d think Netflix might concede that they have a whole leg in the sea on sports, yet they still coyly twirl their hair around their fingers and pronounce that these programming moments were realized because the streamer wants live events, and sports happens to be a part of that, rather than as a result of a specific sports strategy. Ok sure, Netflix, you keep telling yourselves that!

Netflix’s business in both advertising and games remains a journey… There was lots of discussion about what the streamer is doing in both categories, but no material results shared yet again. For younger audiences, there was focus on bringing ad-free kids games to TVs.

“We’ll deliver games for kids. This is no ads, no in-app payments. It’s a safe space for kids just included with your subscription.”

?As a reminder on the advertising front, Netflix serve no ads on any of their kids content.

Movies?

The big spiel on movies was already delivered in my last newsletter. It was all about Spellbound. There were charts! It was awesome! Go check it out!

Beyond what was shared there, I would make one more observation. Carry-On (not based on the Carry On franchise FYI) is a huge success for the streamer. The film stars former Disney Channel actress Sofia Carson, who cut her teeth in the Descendants movies. Since then she’s gone on to have a solid body of work at Netflix, flipping up the audience jungle gym from kids film Feel the Beat, to major straight-to-streaming success Purple Hearts. Carry-On is currently in the process of being enshrined as one of Netflix’s best performing films ever. I would argue this low-key puts Sofia in the same league as Millie Bobby Brown as a bankable star at Netflix.

??

TV Series

On the TV side, things were quieter. Preschool mystery show The Creature Cases, from Sony, made the Netflix Global Top 10 ranking with its new season. This show has been on my radar for a long time, and we’re seeing some interesting behavior for it in the Netflix Kids Content Performance Reports. But man, roll out of episodes is super slow, to the point of painful…

?I wrote up analysis on this AGES ago, using data from Digital i. How are you supposed to build a new kids IP with 30 episodes over three years?! God bless the Sony team for the long-haul plugging.

Also on TV, we have the latest example of “what mad scone in Paramount is making the decisions about franchise content distribution strategy?” Reboot series Fairly OddParents: A New Wish hit Netflix and made the ranking for one week. What I don’t get here is that, as far as the Nickelodeon stable of IP goes, Fairly OddParents, although charmingly old skool, is relatively niche. It’s no SpongeBob. It’s not big franchise energy. So what’s the motivation to compromise exclusivity and value for Paramount+ and window it on a different platform? Answers on a postcard (or an email) please.

What’s Next?

The end of 2024 earnings marked the end of an era for Netflix, an era they’ve ended on an absolute high.? There’s a great unknown out before them as they chart the course without subscriber growth as a familiar comfort blanket to turn to. They’re big in on engagement metrics though, as they said in their earnings letter:

“We want to be the first place members go for entertainment - whatever your taste or mood, and whomever you are watching with. Engagement underpins that goal, as we believe it is the best proxy for customer satisfaction, which in turn leads to higher retention, acquisition and value for our service."

With that in mind, all eyes will be on one kids IP that’s headed to Netflix, which was specifically mentioned in the earnings interview. Ms. Rachel debuts on the streaming platform next week. With behemoth CoComelon in decline, could Ms. Rachelbe the next big thing for the streamer? She’d come at a very salient time, when the platform’s need for the best of the best content has never been more urgent.

?