Studios are reducing their reluctance to send shows to Netflix.
For years, executives at the entertainment company happily licensed classic movies and television shows to Netflix. Both sides enjoyed the spoils: Netflix got popular content like “Friends” and Disney’s “Moana,” which satisfied its ever-growing subscriber base, and it sent bags of cash back to the companies.
But about five years ago, executives realized they were “selling nuclear weapons technology” to a powerful rival, as Disney's chief executive, Robert A. Iger said. Studios needed the same beloved movies and shows for streaming services they were making from the beginning, and fueling the rise of Netflix was only hurting them. The material spigots were, in large part, turned off.
Then the bitter realities of streaming started coming to light.
Faced with massive debt burdens and the fact that most streaming services still don't make money, studios like Disney and Warner Bros. Discovery have begun to soften their stance of not selling to Netflix. Companies are still holding on to their most popular content — movies from the Disney-owned Star Wars and Marvel universes and blockbuster original series like HBO's “Game of Thrones” aren't going anywhere — but dozens of others like “Dune” and ” Movies and series like “Prometheus” and “Young Sheldon” are being shipped to the streaming giant in exchange for much-needed cash. And Netflix is once again benefiting.
Ted Sarandos, one of Netflix's co-chief executives, said at an investor conference last week that “the availability of licenses has opened up much more than ever before,” arguing that the studio's ability to hold back content. It was the first decision. “Unnatural.”
“They've always built studios for licenses,” he said.
As David Decker, president of content sales for Warner Bros. Discovery, said: “Licensing is coming back into vogue. It never took off, but there's more of a desire to license things again. “It generates money, and it gets content seen and viewed.”
In the coming months, Disney will begin sending several shows from its catalog to Netflix, including “This Is Us,” “How I Met Your Mother,” “Prison Break” and several of ESPN's sports documentary series “30 for 30.” Versions included. , The Disney-owned show “White Collar,” which used to be part of the same lineup as “Suits” on USA Network, will also join the service. (Old episodes of “Suits” have been one of Netflix’s biggest hits this year.) “Lost,” the popular 2000s ABC hit that left Netflix in 2018, is also coming back next year.
Jeremy Zimmer, chief executive of United Talent Agency, said the studio face-off was a “financial necessity”.
“They said, 'Wow, to compete in streaming, we're having to spend billions creating new content to drive subscriptions,'” Mr. Zimmer said. “‘Where will we find the money? Oh! We have this stuff sitting here. We can sell it. “It’s a very logical progression.”
Acknowledging the motivation, Paramount's chief content licensing officer Dan Cohen said that the biggest advantage of licensing to traditional media companies is that “the margins are higher.”
Movies and series from other studios have long provided a vital backbone to Netflix, allowing executives to fill the service with established favorites to complement original series like “The Crown,” “Wednesday” and “The Diplomat.” Permission has been granted. The company said Tuesday that from January to June, 45 percent of total views on the service came from licensed shows and movies.
While the amount of licensed content on the service has been increasing since the recession, content from other studios never completely dried up. According to Netflix, four films from Universal Pictures alone feature in the list of top 10 most watched movies for the one-week period ending December 10. Those films come to Netflix from a handful of agreements with Universal, one of which took place in 2021, covering new animated theatrical releases like “The Super Mario Bros.” Move to Netflix as part of a structure that toggles titles between Netflix and Universal's own streaming service, Peacock.
The streaming giant has a similar agreement with Sony Pictures since 2021, under which the studio will deliver films like “Spider-Man: Across the Spider-Verse” and the Jennifer Lawrence comedy “No Hard Feelings” to Netflix four to six months after their theatrical release. Sends. is ready.
Studios are also licensing content to services like Amazon, Tubi and Hulu, all of which Disney owns the majority. And, in most cases, Netflix doesn't have exclusive access to the movies and series it gets; Many titles will also be available on entertainment company services like Max and Hulu.
Still, Netflix's comeback is notable.
When Warner Bros. began building its own streaming service — now known as Max — in 2020, it yanked content from Netflix, which was now a direct and formidable competitor. Netflix has 247 million subscribers worldwide, while Max has less than half that.
David Zaslav cast that policy aside shortly after taking over as chief executive of Warner Bros. Discovery in April 2022. Last month, several seasons of the Warner Bros.-produced CBS show “Young Sheldon” became available on Netflix. The series soon placed itself in the service's top 10 most-watched list.
Several Warner Bros. movie titles also recently began appearing on Netflix, including the 2021 blockbusters “Dune” and DC films like “Man of Steel,” “Batman v Superman: Dawn of Justice” and “Wonder Woman.”
Netflix had been trying to get its hands on HBO content for years. Although HBO has a history of licensing many of its shows — “Sex and the City” to E! For example, the network, or “The Sopranos” to A&E – the company consistently refused to license Netflix.
That suddenly changed several months ago when Netflix purchased the rights to stream HBO series like “Insecure,” “Ballers,” “Six Feet Under,” “Band of Brothers” and “The Pacific.”
Almost all the shows became instant hits on the streaming service.
“I'm comfortable with it and so far it seems to be working,” HBO president Casey Bloys said at a news media conference last month. He added that any show that has been available on Netflix has seen “growth.” In view on the Max streaming service.
Netflix credits its large subscriber base and its recommendation algorithm as reasons why a 22-year-old show like “Six Feet Under” or a once-forgotten basic cable legal drama like “Suits” becomes a hit on its service. It is possible
“It’s a reflection of what we do best,” Mr. Sarandos said this week.
Still, don't expect Netflix to return the favor.
Mr. Sarandos said the company does not have a division for licensing original series, nor does he see any reason to set one up.
“I think we can add tremendous value when we license content,” he said. “I'm not sure it's mutual.”