Netflix, Inc. (”NASDAQ”:”NFLX”) isn’t the most popular firm in Hollywood, at least outside of peoples living rooms. The New York Times reports that the mere mention of the firm’s name is enough to bring harshness into the voices of TV execs. Direct questions on the subject were met with harsher responses.
The Times spoke to the TV bosses during the course of the 2017 ATX Television Festival. Karey Burke, executive VP at Freeform was asked how she looked at Netflix’ big spending. “With disdain.” was her simple response. That feeling appears to be prevalent across the industry as traditional firms battle with the Netflix original content machine.
Netflix gets the wrong end
Other execs were, in some ways, even harsher than Burke. Kathleen McCaffrey, VP for Programming at HBO said of the firm: “They’re playing a different game; it’s cool, whatever.” Nick Grad, President of programming at FX said that the key in TV is to “Make sure everyone has to be profitable.” That’s a jab at the California streaming form which still can’t consistently book profits.
The reason for the hatred of Netflix among those that run TV studios is simple. The firm is willing to outspend almost everybody in order to get its hands on the best content. It doesn’t limit itself to a single genre either. The firm has invaded everything from children’s TV to talk shows.
The effect of Reed Hasting’s strategy, and that of other outlets like HBO, has been to shift the focus away from ratings, at least according to the the piece by NYT’s John Koblin. What’s important, say some of the execs that he spoke to, is that shows create buzz. Those in charge of picking programs want something that will get people talking, and result in blogs and news outlets driving the conversation.
Netflix, Inc. too successful to compete
Netflix has had a major problem in recent years. The tech firm has become so big and powerful that it’s scaring those in charge of traditional TV. As a result executives in charge of licenses are reluctant to let Netflix have them. The firm gets around this issue by creating its own content. Shows like House of Cards and Santa Clara Diet are Netflix Inc. exclusive.
The protectionism of Hollywood should have delayed the ability of Netflix Inc. (”NASDAQ”:”NFLX”) to grow, but its jump into original content also lead to a boom in new subscribers. That has lead directly to the company’s latest war against the networks. Now they’re fighting for content and it’s clear that those in charge aren’t too happy.
Netflix stock is still a hot commodity despite some rocky earnings numbers in recent months. At time of writing the firm’s shares were selling for 151.29, flat for the day so far. In the past year Netflix stock has gained more than 60 percent. As the old adage about sticks and stones goes, TV execs can say what they want. It’s results that really matter and that’s where Netflix is winning. The firm’s next big challenge is to turn its growth into profits for investors.