Netflix Original Series' Performance Impacts Broadcast Nets

by , Dec 10, 2013, 3:04 PM
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Since the start of its original programming push, Netflix hasn’t been telling anyone how many people are watching their shows -- but broadcast network executives are still curious about how it might affect and/or help their business.

For Netflix's highly touted original series -- “House of Cards” (started in February) and more recently, “Orange is the New Black” -- David Poltrack, chief research officer of CBS Corp., estimates that just under 10% of the U.S. adult population have watched each show.

The 2010 U.S. Census says there are 234 million people who are 18 and older -- which would equate to around 23 million Netflix viewers.

Poltrack, speaking at the UBS media conference on Monday, according to Seeking Alpha, said:  “These cumulative audience levels are consistent with similar programs on HBO and Showtime. Where their performance stands out is the number of episodes viewed by the average viewers.”

Because Netflix -- a subscription video-on-demand service -- allows its viewers to see entire season’s worth of these shows, Poltrack says it’s of particular significance in gauging the number of episodes viewers are taking in at a particular time.

He says from February to April the average number of episodes seen by all viewers grew to 11 from three. But then in in July, the average episodes viewed dropped to nine. Still, he says the program continued to attract new viewers.

“When the broadcast network season ended, there was a second wave of new ‘House of Cards’ viewers. In July, this second wave of viewers had not yet gotten through all nine of the episodes.”

He adds: “‘Orange Is the New Black’ is still in phase one of this audience accumulation. The question is whether or not it will also hit a phase two, as we reach the holiday season and a season of more network repeat programs as well.”

What does this mean for broadcast networks, especially for struggling first-run dramas? Poltrack points to one of those, CBS’ new drama “Hostages.”

“Its performance to-date has been restricted by the fact that the live broadcast is up against the very, very hot drama “The Blacklist”  on NBC, a very good program that also has a big lead in advantage.”

But he says nonlinear viewing of “Hostages” in VOD, DVR playback and streaming reaches the same levels as much more popular programs. “So the question is, is there a secondary market for programs, such as “Hostages,” in the SVOD [subscription video on demand] category?”

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