Tuesday, February 23, 2016

Potential Departures in 2016

There has been several items in the news of late that might be of interest/concern for Netflix users.  I'll list the items and rate it on a scale from 1 to 10 as for the likelihood of Netflix losing said show/service in the next year.  I will keep this updated as I learn more one way or the other.

Star Trek franchise:  I didn't personally see an expiration date, but it popped up on Amazon Prime sometime in late January counting down to February 15 for all the Star Trek series (original, The Next Generation, Deep Space 9, Voyager, and Enterprise).  Fortunately, they got it renewed in time to avoid any interruptions.  There's relatively good news on this front.  One, CBS All Access which launched in October 2015 apparently has all the live action series in question streaming currently prior to its launch of the exclusive Star Trek 6 series (no title currently).  Two, they already have some exclusive series to Access; they're called Big Bang Theory, Mike and Molly, Mom, etc (in other words, their current lineup).  The odds that All Access will attempt to block Amazon Prime, Hulu, and Netflix from streaming Star Trek is pretty low.  In essence, it's just filler that most streaming services have to build up series/episode counts.  Plus, in March, we're getting films 1-3 in the franchise film series, in addition to the ones currently streaming (practically every ST movie now except for the reboots).  I'd set phasers on a very mild stun.

Odds of leaving Netflix in 2016:  I'll go with 2 for now.  Unless major evidence changes, I think it's OK to start streaming those shows without fear of being interrupted.

NOTE on July 1:  The films have beamed over to Amazon.  But it's nothing to worry about, as odds are that it will be headed back our way soon enough.  No signs of expiration for those series.  And it appears that Netflix will renew a few older series (MacGyver, Ghost Whisperer), if so inclined to.

CW shows:  Apparently, the CW is thinking about forming its own streaming service for its shows.  Its price point potentially would be anywhere from $2-4 per month.  And part of those thoughts might include the CW pulling its own shows from Netflix and Hulu as part of the service.  There is more truth here than with Star Trek.  For starters, the contract for new CW series opening in the last year is up (Crazy Ex-Girlfriend and Legends of Tomorrow are potentially at stake).  But there's also some good news in this front.  The shows that are currently streaming on Netflix (Arrow, Vampire Diaries, The Flash, Jane the Virgin) appear to be safe as long as they air on TV according to content officer Ted Sarandos.  So the odds of waking up and not seeing Arrow one morning are pretty low.  It's the new programming that appear to be more at stake as well as shows that end up getting cancelled (Reign is in serious ratings trouble and Jane the Virgin is struggling).  And Netflix is in current negotiations to renew its deal with the CW and perhaps acquire the other shows.  So a good faith effort is being made at least.

Odds of current series leaving Netflix in 2016:  I'll go with a 2.  Unless someone shows up with a blow away offer or Netflix pisses off CBS and/or Warner Brothers, I'd say you can start streaming Vampire Diaries and/or one of the CW comic book franchises and be fine.

Odds of new series making their way to Netflix in 2016:  This is more of a crapshoot.  I'll go with 5 unless there's evidence that points one way or the other.

NEWS as of June 20:  Lock it in.  CW shows are safe.  Netflix and CW have announced a new deal that should make new seasons of existing shows available within 2 weeks after the season finale.

Miramax/Dimension:  Apparently their five year deal expires at the end of the month.  A whole bunch of movies are affected so far (it might eventually get as bad as Kino Lorber's partial plunge last fourth of July).  Fortunately, most if not all were left out of Netflix's PR going away list in May (the same list that omitted Sherlock, Scrubs, and The Boondocks).  So perhaps a good faith effort is being made to save these shows as well?

It depends on whether Netflix can get an exclusive deal with Miramax/Dimension to stream its films worldwide.  Based on remarks by Ted Sarandos, chief content officer where he implied that they didn't even offer a bid to renewals or single territory output deals, it doesn't sound promising.

Certain films like the Spy Kids franchise, Adventureland, and Pulp Fiction (complete list in the June Expiring list) didn't appear to have expiration dates before Netflix made the conscious decision to pull the dates from the DVD section altogether.  The fact that they're being secretive with those dates is concerning as is the lack of news on that front.  Unfortunately barring a late May surprise, I'm going to go with an 8.  There's several films that I need to get done with (The Glass Shield, Below, Existenz) before the deadline.  I'd advise you to do the same.

NEWS as of June 20:  Miramax/Dimension and Netflix announced a deal shortly after a lot of the films had expired.  There's maybe 10-15 percent of what was available currently streaming, but thanks to a source, I think I can confirm that at least the first Scary Movie is returning July 1.  Will it arrive alone or might we find other films on the way?

Scripps Network Interactive:  The owner behind Home and Garden TV (HGTV), Food Network, DIY, the Cooking Channel, and the Travel Channel announced that they won't renew their deal with Netflix.  Which means no new shows and the ones there now will probably disappear on December 31.  So yeah, that's a 10.

7 comments:

  1. The Netflix contract that just expired includes all CW shows beginning with 2010-11 season except for holdovers from the WB and UPN (like Gilmore Girls). Netflix has exclusive streaming rights to all past seasons of shows until four years after the last season. For shows like 90210, Gossip Girl and Nikita, streaming rights could end in the fall of 2018 or 2019. You have to check when the last season was televised. Shows that began in the fall of 2015 and after are not included. For example, if Arrow runs until 2020, Netflix has exclusive streaming rights until 2024, but it has no rights to Legends of Tomorrow, which began last fall. This makes a CW streaming service not terribly attractive. Some past shows are currently streamed free on the CW streaming site. (No need to be a cable subscriber.)

    I think the chances of a new contract are less than 20%. There are different philosophies at work here. Netflix would like a contract with the CW that provides for global exclusivity, which I don't think the owners of the CW--CBS and Time Warner--are interested in. Time Warner has said they want to hold back seasons of series for at least a couple of years while they continue to stream on cable VOD. CBS has had a good relationship with Netflix, but I am sure they would like to have more shows behind their paywall. They currently have shows like NCIS and Blue Bloods behind their paywall but these shows also stream on Netflix.

    Time Warner is currently negotiating to buy a 25% stake in Hulu, but they have said they will not show on Hulu the series they own that are currently on TV for at least two years. That's a bit inconsistent with their current practice of having seasons of shows they own and air on TNT (which Time Warner owns) stream on Hulu right before a new season appears (I.e., the Netflix model).

    Netflix is paying close to $1 billion over time for the "old" contract, which was hailed as saving the CW from extinction when it was first entered into. At the time, the network was aimed specifically at teenage girls. Now the network attracts teens of both sexes and, for Jane the Virgin, adults as well. I have no idea what a new contract would cost Netflix, but my sense is the hangup is not money but (a) Netflix's desire to get a global exclusive on all CW content (so far, some networks have given global exclusivity to individual shows but it has been extremely difficult and expensive for Netflix; and (b) Time Warner's desire to hold back content from streaming services for at least two years, which I don't think Netflix would agree to. I think the notion of a CW streaming service, at least in the near future, is not realistic since Netflix has exclusive rights to so many shows. (They might be able to show all episodes of a current season until the season ends; I believe Hulu has the rights to stream the five most current episodes of CW shows.) It might be more realistic for the CW to sell individual shows to Netflix or they could put the shows they can stream behind the CBS All Access paywall and agree to sell the rights to these shows to Hulu after two years. Hulu doesn't seem as averse to streaming content that has appeared on other streaming sites and getting exclusive streaming rights to CW shows after a couple of years would probably be seen by them as a feather in their cap. If the choice for Netflix is to pay $2 billion plus for content that is two years old or to spend that money on Netflix originals, I think this is a no-brainer--they will go for originals. As far as the CW goes, they are on a better financial footing now. I don't think the CW is going to make more money by not entering a contract with Netflix, but Time Warner has said that they could live with the short-term pain if not giving Netflix the content would, in their eyes, make the network more valuable to cable subscribers.

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  2. Brian, my less than 20% probably equates to a 1.75 on your scale. Also, Netflix is continuing to pay for every new season of a CW show that streams on Netflix. Presumably, how much and when Netflix pays would be renegotiated under a new contract. However, if no new contract is entered into, it's not like Netflix is continuing to stream old episodes of CW shows or get new episodes for free. I am sure there is some formula in the "old" contract that determines what the annual payments by Netflix are based on the number of series they are streaming and the number of seasons.

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  3. I am stunned that the new CW-Netflix is coming together. First, it violates the Netflix principle of demanding global rights. (Not that this principle has stopped them before. Second, this has to be an incredibly expensive deal--maybe as expensive as or more expensive than the Disney deal. Third, Netflix has refused to continue output deals with AMC, the History Channel and others, so what's so different here? And what are they getting for their money? Since they already had streaming rights for all CW shows from 2011 to 2016 so long as a show was on the CW and for a period of about four years after a show went off the air, the only new shows they are getting rights to are My Crazy Ex-Boyfriend, Containment (which has already been cancelled) and presumably Supergirl, which is moving from CBS to the CW this fall. I don't think there are any other shows coming in 2016. Will they get continued access to shows like 90210 and Nikita that are approaching the dates when they would have normally expired? Don't know. Getting streaming rights much earlier is certainly a plus (and it doesn't hurt that the Hulu/CW deal is going away). Still, it's got to be a lot of money that could have been used to buy other, non-original TV shows. Quite honestly, I would have preferred the AMC/BBCAmerica/Sundance output deal that Hulu has with AMC or any of the newer FX or TNT shows that also went to Hulu. I would also have preferred a renewal of the Mirimax deal that kept the whole catalogue or other deals for good movies. Of course, I am not really in the CW demographic range so maybe this deal wasn't for my benefit anyway. I would just like to know what deals were not pursued or are not going to be pursued as a result of the dollars going to CBS and Warner Bros., owners of the CW.

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  4. Press release on 7/5 confirming extension of Netflix/CW deal in US. Covers all seasons of CW content currently on air, including shows added in 2015-16 season plus all future shows during (unspecified) life of contract. Like old contract, Netflix can stream seasons of current and new CW series as long as series is broadcast and for some period of time (4-5 years?) afterwards. Big deal is that seasons of series come to Netflix eight days after season end starting with 2016-2017 season. CW deal with Hulu to stream five most recent episodes of CW series during season ends in November; no CW episodes stream on Hulu after that date.

    Take-away: Netflix commits to spend a lot of money on CW content in one territory (US) in return for getting exclusive streaming rights to current CW programming (most of which they had tied up under old contract) plus future seasons eight days after season ends, admittedly a big deal. Deal does nothing to help Netflix internationally. (Jane the Virgin already streams globally on Netflix under separate deal.) Unclear how many people watch CW shows on Netflix, but probably a lot since CW demo skews towards teens and young adults, a prime target for Netflix.

    Warner Brothers (half-owner of CW) backs off its statements committing to hold back streaming content from Netflix or any other streaming platform for one to two years, showing money trumps words. However, ends deal with Hulu to stream episodes during season.

    Hulu loses all CW content as of November 1, and Hulu could lose some subscribers to Netflix. Unlikely to lose other current content during a season since that content comes from Hulu owners (Disney/ABC; Fox; and Comcast/NBC) so actual damage is probably minimal but still embarrassing to lose programming. Deal to get Warner Brothers as part owner of Hulu is probably dead for now.

    CBS, other half-owner of CW, continues its relationship with Netflix notwithstanding its creation of its own streaming service.
    CW content will stream on CW streaming service during regular season (unclear whether there is a limit on number of episodes); not clear whether CW content will also stream on CBS streaming service concurrently).

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    1. I think the key word here is exclusivity. Keep in mind that Netflix is raising its rates and any good news for its subscribers is probably appreciated. Netflix gets its window for CW series dramatically reduced and quietly strikes a blow against Hulu. The CW is probably hoping that this deal may lead to higher ratings because people might have more time to catch up on some series before their new season in October. They badly need the ratings and yeah, I'd say they probably get a decent amount of streams from Netflix subscribers.

      You have to take some of Netflix's proclamations with a grain of salt. Remember when Ted Sarandos claimed that there'd be only two studios where they'd have content deals with (Disney and Weinstein)? I've proven that to be false as they have deals with more studios than that (although I'd have wished they would go back in time to grab a deal with A24). The emergence of St. Vincent in August more or less confirms that (Netflix does have a deal with IFC, but you didn't hear that from me).

      As far as I know, nobody has picked up STX Entertainment (The Gift, The Boy, Secret in Their Eyes) yet.

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  5. I believe St. Vincent is a Weinstein film, not an IFC film. Nevertheless, I agree that most non-documentary IFC films seem to appear exclusively on Netflix. IFC Films recently entered a deal with Hulu to stream its documentaries exclusively with Hulu.

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  6. Since I'm not privy to the details of the CW-Netflix contact (other than reading that its price tag is comparable to their former deal ($1 billion+ over time) and I am not in the CW demographic, it is difficult for me to asses the value of the contract to Netflix subscribers. The only basis of comparison is to consider what Netflix gained from the new agreement (access to new shows from 2016 through the life of the contract, which probably amounts to 15 to 25 new shows; the ability to stream new seasons, beginning with the 2016-2017 season, eight days after a season ends; and the removal of Hulu as a streaming competitor, although arguably that helps the CW and its co-owners more than it helps Netflix). On the other side of the ledger are lost opportunity costs to the tune of $1 billion over time, which could have translated into output deals with independent studios rather than reliance on Adam Sandler and Ricky Gervais. I doubt they could have convinced FX to enter into an output deal since FX views Netflix as the streaming anti-christ but they might have gotten the AMC/Sundance Channel/BBC America deal. Some of the Sundance and BBC America series may have been too sophisticated for Netflix viewers, but rightly or wrongly I credit Netflix viewers with better taste than Hulu subscribers. Probably the biggest loss to Netflix is Fear the Walking Dead and maybe Preacher which might not have been worth the cost to Netflix. Netflix has enough original series teed up that spending another $1 billion might have been overkill. As it is, I am seeing a great deal of inconsistency in quality control and some really selective promotion of some series over others. Netflix could have spent more money on acquiring movies although they are probably overspending now. Logically, the place to spend $1 billion is on local foreign content and better subtitling in foreign territories. I think Netflix reports their Q2 results in the next week or so, and it will be interesting to see what their cumulative foreign growth is. I have read reports that they are not doing well in Japan or South Korea because of a lack of local content. In fact, there is probably more Indian, Japanese and South Korean content showing on Netflix US than in their respective countries. While it is probably easier--and less expensive--to buy that content for US consumption, I think Netflix would be wiser to bulk up its local content than rely on American and British content (even if they are originals) in its non-English speaking foreign territories. I have frequently questioned whether Netflix has moved too fast in its global expansion. It's a lot easier to connect the Netflix pipes globally than it is to fill it with the right combination of content. Netflix should also spend some money on a deeper bench of content seekers. Right now, it looks like the Reed Hastings/Ted Sarandos show, with Hastings as the techie and Sarandos as the arbiter of content. If there are more people working on content acquisition and development, it might be nice to give them some recognition.

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