Netflix's granular expectations of TV shows helps when you have business analysts worried the SVOD service's crazy high production expenditures -- estimated to be $8 billion and growing -- might be an albatross.
Speaking at a Vanity Fair event in Los Angeles on Tuesday, Ted Sarandos, chief content officer, Netflix, did not go into detail regarding specific projections of Netflix shows, but he offered this:
“What we can help them do is size the project. We have enough years of performance data of different shows -- not perfect, but better than most -- to have the ability to say this is going to be a big show, a medium show, or a small show.”
We can also guess that Netflix -- in picking up formerly discarded or revived broadcast TV networks shows -- could count on broadcast network data for shows such as “Arrested Development,” “Fuller House” and others.
Broadcast TV shows for some time -- to a much rougher degree -- predict how new shows will perform, especially when it comes to particular lead-in programming and specific days-of-the-week viewing. To be fair, those metrics increasingly mean less than they did years ago.
Netflix no doubt has deeper measures. It can see exactly when a subscriber is beginning to watch a episode, when that subscriber abandons it, and where and when that subscriber moves to other Netflix content.
Media business analysts are worried about the high-priced cost of signing on big broadcast TV producers, such as Shonda Rhimes ($100 million over three years) or a Ryan Murphy ($300 million over four years). But Sarandos says it just comes down to modern entertainment math.
“It’s not that different from [broadcast] television. A studio or a network would be paying them [what amounts to] a percentage of their advertising and carriage revenue. We are just paying a percentage of our subscription revenue.”
Nice to see a TV service -- digital, linear, on-demand, or otherwise -- that can closely identify expectations, risks -- and hopefully, flops.
So how about showing us some metrics? Forget about viewership of its shows, which Netflix has long refused to share. Just show us your projected TV-show size algorithms. Interested parties want to know.