The Drum Awards for Marketing - Extended Deadline

-d -h -min -sec

Netflix

Netflix boss responds to TV networks' criticisms of its business model and ratings secrecy

Author

By Tony Connelly, Sports Marketing Reporter

January 18, 2016 | 3 min read

Netflix’s has hit back at criticisms from NBC after the TV network claimed the streaming service did not have enough broad appeal to be a legitimate threat to its business.

Ted Sarandos

Ted Sarandos

Speaking at the Television Critics Association press tour in Los Angeles earlier this week, NBC's research executive Alan Wurtzel, antagonised Netflix by attempting to oust viewing figures for some of its shows; something which Netflix makes a point of not doing.

Netflix’s chief content officer Ted Sarandos responded to the claims by saying they were "remarkably inaccurate" and then joked about the network's obsession with the streaming company's ratings.

Sarandos explained that ratings "make no significant affect" on the Netflix’s business because its business model depends on subscriber numbers rather than ad sales according to viewership.

"If we turn it into a weekly box score, like TV, it will be negative," he said when arguing that, unlike with TV networks, Netflix’s audience was more fragile because if fans thought their favourite shows were in danger of being canceled they would simply leave the service.

"It only takes one press of a button to cancel Netflix," he said.

There is little question that streaming services such as Netflix and Amazon Prime pose a significant threat to TV networks and NBC will be keen to assert dominance wherever possible.

One area which NBC leads the way with is advertising; the TV network is currently the number 1 broadcast network in the ratings most important to advertisers targeting viewers aged 18 to 49 years-old.

Other attacks directed at Netflix this week came from FX Networks chief executive John Landgraf who suggested that the streaming service’s lack of need to be profitable meant that it was able to overspend on original content. He said FX wanted Aziz Ansari's "Master of None," but that Netflix outbid them for the show.

Sarandos responded by saying that Netflix's profitability comes from its international business and not its original content.

Netflix

More from Netflix

View all

Trending

Industry insights

View all
Add your own content +