Analyst: Netflix to Weather Content Migration — For Now

With Netflix set to release second-quarter (ended June 30) financial results on July 17, Michael Pachter, analyst with Wedbush Securities in Los Angeles and longtime Netflix bear, contends the subscription streaming video pioneer will add 5.3 million subscribers, including 300,000 in the United States.

The tally surprisingly exceeds Wall Street consensus and Netflix’s projection of 5 million new subs, including 4.7 million international subs.

Pachter argues that despite media attention to the departures of popular TV reruns “Friends” and “The Office” from Netflix in two years, the service has more than enough content in the pipeline and willingness to spend big on new programming to weather the storm.

“Friends” and “The Office” account for an estimated 5% of all viewing on Netflix, leaving other content that accounts for 95% of viewing on Netflix in place.

Indeed, Netflix launched 21 new shows in Q2, excluding 13 returning series. That compared to six news series and 17 returning series in the previous-year period.

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At the same time, content from NBC Universal, Fox, Disney and Warner Bros. currently accounts for upwards of 65% of Netflix viewing hours, according to Wedbush.

Pachter expects the migration of third-party content away from Netflix to competing platforms to be relatively slow and is unclear whether the service can successfully replace it with quantity and quality to keep its subscribers loyal.

“We think it is likely that Netflix will pay whatever it takes to attract high quality content and believe its competitors will be slow to gain scale,” Pachter wrote in a note. “Thus, we expect the status quo to be largely maintained until the end of 2021. For now, Netflix provides tremendous value for its subscribers.”

NBC Universal Taking Back ‘The Office’ From Netflix in 2021

As expected, NBC Universal June 25 announced it has secured the exclusive domestic streaming rights to “The Office.” All nine seasons of the catalog NBC sitcom will be available on the company’s soon-to-be-launched ad-supported/subscription streaming service for five years, beginning 2021.

The sitcom, similarly to Warner Bros. Television’s “Friends,” is currently exclusively licensed to Netflix. Both shows have become subscriber favorites for the SVOD behemoth — and thus coveted programming for NBC and WarnerMedia as they prep pending over-the-top video platforms.

“‘The Office’ has become a staple of pop-culture and is a rare gem whose relevance continues to grow at a time when fans have more entertainment choices than ever before,” Bonnie Hammer, chairman of NBC Universal direct-to-consumer and digital enterprises, said in a statement.

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“The Office” is the number one series on SVOD, according to the media company. In 2018, it was streamed for over 52 billion minutes, and in April 2019, it was viewed nearly twice as much as the next most-viewed program on SVOD.

“‘The Office’ is one of our most prized series,” said Pearlena Igbokwe, president, Universal Television.

Produced by Universal Television in association with Deedle-Dee Productions and Reveille Productions, “The Office” takes a documentary-style look at the humorous and foolishness that plagues the 9-to-5 world. Based on the award-winning BBC hit, “The Office” is a fly-on-the-wall “docu-reality” parody of modern American office life that delves into the lives of the workers at Dunder Mifflin, a paper supply company in Scranton, Pennsylvania.

The show, which premiered on NBC in 2005, created indelible characters like Michael Scott, Dwight Schrute and Pam & Jim, and launched the careers of some of Steve Carrell, Ed Helms, John Krasinski, Mindy Kaling, Ellie Kemper, B.J. Novak, Craig Robinson and Mike Schur, among others.

“The Office” is executive-produced by Ben Silverman, Greg Daniels – who developed the series for American audiences – Ricky Gervais, Stephen Merchant, Howard Klein, Paul Lieberstein, Brent Forrester and Dan Sterling.

In addition to being NBC’s highest-rated scripted series for multiple seasons during its broadcast run, “The Office” was named one of the best shows on TV by dozens of media outlets, including TIME MagazineRolling StoneEntertainment Weekly and The Atlantic, while also being a consistent awards contender with 180 nominations and more than 40 wins.

Among its prestigious honors are the Emmy Award for Outstanding Comedy Series, the Peabody Award, AFI Honors, the Producers Guild Award, the Writers Guild Award, the SAG Award for Outstanding Performance by an Ensemble in a Comedy, and a Television Critic’s Association Award for Outstanding Achievement in Comedy.

NBC Universal Planning to Offer ‘The Office’ on New Streaming Service

NBC Universal reportedly plans to stream popular catalog sitcom, “The Office” on its pending streaming video service.

The media company owned by Comcast disclosed the move May 13 during its advertising upfront at Radio City Music Hall in New York.

Comcast is slated to launch a free ad-supported VOD service for Xfinity subscribers next year. Non-pay-TV subs would be charged an undisclosed monthly fee.

“While other companies are pushing advertisers out, we’re bringing you in,” said Linda Yaccarino, chairman of advertising and client partnerships at NBC Universal, told advertisers, according to Bloomberg, which first reported the move.

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Yaccarino is on Hulu’s board of directors, along with NBC Universal’s Matt Bond and Jeff Shell, chairman of Universal Filmed Entertainment. NBC Universal co-owns Hulu with Disney.

The programming decision is significant since “The Office,” along with WarnerMedia’s “Friends,” remains extremely popular on Netflix. The SVOD behemoth recently renewed an exclusive license agreement for ‘The Office” through 2020.

Last year, it reportedly paid WarnerMedia $100 million for exclusive rights to an additional single season of the sitcom.

Netflix earlier this year tweeted it had signed “Office” star Steve Carell for a new workplace comedy created by “Office” showrunner Greg Daniels about people working in the new armed services unit: “Space Force.”

Netflix Original Content Outpacing Licensed Fare

As expected, Netflix is spending more on original content than licensing third-party programming. While Netflix senior management has long championed original vs. licensed fare as evidenced by its indifference toward Disney’s decision to withdraw first-run movies from the streaming service – now there’s data to prove it.

London-based Ampere Analysis found that 51% of domestic programming was original (proprietary and exclusive from studio partners) through the end of 2018 – up from 25% at the end of 2016. The research firm contends 30% of Netflix original content is studio based.

“Netflix’s strategy is clearly moving towards a self-sufficiency model,” analyst Lottie Towler said in a statement. “Its focus on growing the proportion of original content in its catalog shows no sign of slowing down – in fact Ampere’s analysis shows the streaming giant is reaching a point where it produces almost all the new and fresh content, while only the older content is licensed.”

In December 2017, more than 3,000 titles available on Netflix U.K. were available in more than 15 Netflix markets worldwide. In December 2018 the tally had increased by 1,600 titles.

“I’d say the vast majority of the content that is watched on Netflix [is] our original content brands,” CCO Ted Sarandos said on the fourth-quarter fiscal webcast.

Ampere contends Netflix’s focus on proprietary programming will help the streamer when episodic content producers such as Disney/ABC Television, Warner Bros. Television and NBC Universal pull back popular shows such as “Grey’s Anatomy,” “Friends,” and “The Office,” among others.

“This will position Netflix well in the market should other major studios follow in the steps of Fox and Disney and pull their content from SVOD services in advance of launching their own [direct-to-consumer] offers,” Towler said.

 

Amazon’s IMDb.com Bows Original Comedy Series

Amazon-owned movie/TV show database IMDb.com Jan. 16 announced the premiere of “UnMade” (www.imdb.com/unmade), a new original series that follows comedians as they share the plots, inspirations and stories for projects that are not listed on IMDb, because they were never produced … until now.

In each episode – also available on just-launched ad-supported VOD service IMDb Freedive – celebrity comedians remember projects they wrote before they were famous – and, spoiler alert – Hollywood missed out on some winners. These ambitious yet sometimes misguided scripts are given a second chance and brought to life via a team of actors and a professional production crew.

The first three episodes feature Jay Chandrasekhar (Super Troopers), Kristen Schaal (“Last Man on Earth”) and Rainn Wilson (“The Office”) sharing ideas for “unmade” projects. Future guests include Nick Cannon, Bobby Moynihan, Tig Notaro, Paul Rust, Reggie Watts and “Weird Al” Yankovic.

Schaal’s episode takes viewers behind the scenes of her film Avant Garde, which she developed during a college screenwriting class.

The series is produced for IMDb by production company Big Breakfast in Los Angeles.

Viewers can catch new weekly episodes on IMDb’s iOS and Android apps, and the recently launched IMDb Freedive channel, available on IMDb desktop and Fire TV. Fans will also receive regular updates and show content on the IMDb Facebook, YouTube and Twitter channels.

“UnMade provides fans with a comedic new perspective on how the industry works, and why certain projects get made… or don’t,” Steve Bernstein, GM of IMDb Video, said in a statement. “Following the success of IMDb original series like ‘The IMDb Show,’ ‘So Far,’ ‘No Small Parts,’ and ‘Casting Calls,’ we are thrilled to team up with Big Breakfast to offer even more original videos for our customers to dive deeper into the stories that shape the industry.”

 

Amazon’s ‘Jack Ryan’ Getting Dolby Treatment

Actor Jack Krasinski’s recent movie, A Quiet Place, stressed silence as a means of survival against extraterrestrial creatures that hunt by sound.

Now, the “The Office” alum is upping the volume in a second season turn as a CIA analyst in “Tom Clancy’s Jack Ryan,” which begins streaming on Prime Video Aug. 31.

Dolby Laboratories and Amazon announced that the series will be available in both Dolby Atmos and Dolby Vision HDR. The combined Dolby Atmos and Dolby Vision experience will initially be available on certain Dolby Vision TVs and Dolby Atmos enabled audio devices.

Dolby Vision claims to deliver contrast, color highlights that are up to 40 times brighter than standard TV quality, and blacks that are 10 times darker. When combined, Dolby says the lifelike images and sound “leap from the screen” to make entertainment experiences “truly spectacular.”

“Amazon is committed to delivering immersive and compelling content to our Prime Video members around the world,” Greg Hart, VP of Prime Video, said in a statement. “Dolby Atmos and Dolby Vision will enhance the action-packed scenes in ‘Tom Clancy’s Jack Ryan’and make viewers feel like they are at the center of the story.”

“Dolby enables spectacular audio and visual experiences that take your favorite entertainment to the next level,” said John Couling, SVP, commercial partnerships, Dolby Labs. “Through our growing work with Amazon, we can now bring more lifelike experiences to Prime members.”