GM Thought of the Week – ITV to pull content off Netflix
ITV are preparing to remove their programming from Netflix, following in the footsteps of other entertainment power houses such as Disney and DC.
This move coincides with the announcement of Netflix’s latest challenger in the streaming service arena – NewTV – of which ITV are one of a number of financial investors. In fact, the list of investors reads as a who’s who of high profile entertainment companies including Disney, Sony, Lionsgate, NBCU, Viacom, WarnerMedia and Fox (amongst others). The brainchild of former DreamWorks executive Jeffrey Katzenberg, the service will aim to bring short series comprising of 10-15 minute episodes, designed for the smartphone generation.
Many of the backers do of course have their own VOD services outside of Netflix, with revenues most commonly raised via advertising, the antithesis to Netflix in the eyes of consumers. NewTV however will offer consumers a choice between a free service funded by advertising, or an “ad light” version founded via subscription fees. This will offer investors multiple revenue streams, understandably potentially more attractive than Netflix.
So it will benefit production houses, but how about advertisers and licensees. A lot of this will depend on consumers of course. With Netflix and to a lesser extent Amazon Prime commanding a large share of online video real estate (and YouTube and Facebook looking to muscle in on the premium content scene), there is certainly potential for failure. Especially when you consider there is much content freely available from these companies.
However given the level of investors, there is cause for optimism. Should this be the case, then we should finally see the missing link in the online streaming bubble – data (otherwise there will be no advertising investment). This will of course add further fuel to the fire regarding the debate around the demise of linear TV, but it will also allow licensees to make informed decisions about which shows to back and how heavily. This is in stark contrast to the current Netflix model, and would certainly be welcomed by many industries. Who knows, it may even encourage Netflix to change their own policy…
Lisa Kinsella, Associate Director of AV Investment