Stealing The Show

Cross distribution is?giving second chances to many shows, getting them an extra boost in new platforms. The two-season drama "Your Honor" has just been watched for over 1.5 billion minutes after being added to Netflix's catalogue, according to Variety and Deadline. Originally screened at Paramount +, the show ramped up to become the most watched series of the season. This is not an isolated case, but rather?a recent trend. Last year the USA originals "Suits" landed on Netflix breaking?records, as THR states.

?

Originals and Licensing

There are two main types of deals that streamers currently work with: originals and licensing. Originals are developed by the streamers under their own quality control, completely tailored to their specific?needs (but always produced by third parties). They are also exclusive and can stream indefinitely. Although it is not easy to tell which content belongs to who, there are ways to know it - Netflix, for example, displays?a red letter "N"?on the left top side.?

Licensing, on the other hand, is what allows shows such as "Sex and the City" (an HBO production) and "Grey's Anatomy" (an ABC original) to be available on Netflix now. Licensing works for a specific period of time (usually up to ten years), in particular territories. After the license expires, the show can either be renewed or it goes back to its original producer.

?

Musical Chairs

Back in 2007, when Netflix launched with zero?original productions, they relied on licensing?content from NBC, Universal, Disney and Time Warner. For those studios, the deal represented a new stream of revenue – nobody at the time thought that Netflix would literally steal the show. It wasn't until 2013, with "House of Cards", that the big streamer started producing its?programming.

Around 2017, when Netflix became the biggest beast of all, every single studio realized that they were leaving money on the table by licensing their productions. Almost overnight each?major studio launched their?streamer. As the licensing deals?they had with Netflix started to expire, they did not renew them. All?original content went back to their own producers to help?build a proper catalogue inside of their newly build platforms. ?

Subscription Fatigue

According to Forbes, in 2022?studios resumed licensing back to Netflix in order to drive profits up. The revenue the giant streamer brings is higher than keeping their originals locked in their own platforms. Therefore, Warner Bros. Discovery (HBO Max), Disney and NBCU have licensed back most of its originals to Netflix. ?

One of the biggest reasons this is happening is a subscription fatigue (more about this in?our previous newsletter Pirates of the Streaming). One thing is evident: part of this fatigue comes from the fact that it is hard to keep track of what is playing where. Consumers need to research prior to watching content that is offered as a purchase or rental?– it can very well be?free in a platform they already are subscribing to.

With all that in mind, remember how IPs?can bring unexpected revenue even after many years of dormancy. Reach out if you would like to discuss with us content that will be running for ages! ?

Best,

Laura

*We appreciate having you as a loyal reader of our free newsletter. Please share and comment if you like what you read!