January 1, 2020
New Year’s Day 2020 started ominously for Netflix as it officially no longer can stream ongoing syndication hit “Friends,” the former NBC sitcom that introduced Rachel, Monica, Ross, Chandler, Joey and Phoebe to American living rooms and made household names of Jennifer Aniston and others.
The 26-year-old series stopped airing on primetime television 16 years ago, but has remained a lucrative product on syndication, packaged media and streaming.
Netflix lost exclusive “Friends” streaming rights to WarnerMedia’s pending streaming service HBO Max, which paid $425 million over five years to snag all 236 episodes of the series. “Friends” reportedly was the second-most-popular series on Netflix in 2018, according to Nielsen.
HBO Max reportedly spent billions more to secure exclusive streaming rights to “South Park” and “The Big Bang Theory”.
“How [‘Friends’ exit] impacts [Netflix] in terms of subscribers … will really depend on what else they have coming up that we’re not focused on,” Courtney Williams, Europe regional director for Parrot Analytics, told Vanity Fair.
Indeed, Netflix original series “Stranger Things” and “The Witcher” continue to congregate atop weekly Parrot Analytics charts tracking the most on-demand programming.
“I don’t think any specific content matters at all to Netflix,” Michael Pachter, media analyst at Wedbush Securities, said in an email. The analyst contends the bigger threat to Netflix is when other content creators collectively divert content toward proprietary services.
With Netflix increasingly losing Disney/Fox, NBC Universal and Warner Bros. content, consumers will feel compelled to try new services offering recognizable programming and/or favorite shows, according to Pachter.
The analyst believes Netflix will lose around two-thirds of its content (measured in viewing hours) and will have a tough time replacing that with content of similarly perceived quality. At the same time, Pachter says competitors such as HBO Max will take awhile to gain traction with consumers.
“We expect the [Netflix No. 1] status quo to be largely maintained until the end of 2021,” he said. “For now, Netflix provides tremendous value for its subscribers.”