Cordkillers 413 - Flixstarter
Netflix confirms ad-supported plans and we explore what new formats of ads Netflix may take that isn't just a commercial interruption. SVOD growth is slowing, but still has growth...for now. What streaming subs will people axe first? All that and more on Cordkillers!
This week on It's Spoilerin' Time: Obi-Wan (106), The Boys (306), Westworld (401)
When we return on July 11, 2022: The Boys (307-308), Westworld (402-403)
CordKillers: 413 - Flixstarter
Recorded: June 27 2022
Guest: None
Intro Video
AppleTV+'s upcoming Surface
Primary Target
Ted Sarandos Explains Why Netflix Will Add New Ad-Supported Tier to Streaming Service
- We've heard Netflix was considering an ad-supported tier and a lot of sources said it's happening, but we now have the official word from Netflix Co-CEO Ted Sarandos.
- Indeed. At the Cannes Lions advertising festival Sarandos not only confirmed the plans are going ahead but explained why Netflix has changed its mind on implementing ads. Sarandos said, “We’ve left a big customer segment off the table, which is people who say: ‘Hey, Netflix is too expensive for me and I don’t mind advertising,'” He also added, "...we’re not adding ads to Netflix as you know it today. We’re adding an ad tier for folks who say, ‘Hey, I want a lower price and I’ll watch ads.'”
- He wouldn't clarify what partners Netflix is talking to-- Google and NBCUniversal are the rumors. Sarandos only said "we're talking to all of them right now."
- Sarandos explained that they want a "pretty easy entry to the market" but that “What we do at first will not be representative of what the product will ultimately be. I want our product to be better than TV.” He added that the company wants to build an ad experience that is “more integrated and less interruptive”
Netflix Confirms Partnership Talks for Ad-Supported Service
Netflix, Disney+ Plan to Sell Ads, But Fox Nation Already Has Some
- Now that is interesting. Variety had an article that might shed light on the kind of thing Netflix would do. Fox News's subscription service Fox Nation has been running banner ads from Camping World on the bottom third of the screen during episodes of Duck Dynasty. And the service plans to continue to "promotional billboards" as they call them rather than interrupting a show with traditional 30-second spots.
- I know a lot of folks don't like the idea of ads interrupting a show, but what if the ads don't interrupt, but just pop up from the bottom? How do we feel about that?
How to Watch
U.S. Subscription VOD Revenue Growth Slowing to 13% in 2022, Hitting $25 Billion: PwC Report
- When the majority of the populace stayed home in 2020, a lot fo folks signed up for streaming services and over the course of a couple years a lot of new services were launched.
- So it isn't a surprise that people would cut those streaming services back as they learn which ones they actually like, and spend less time at home.
- PwC's latest estimates show Streaming VOD or SVOD services in the US will bring in 13% more revenue in 2022 over last year. That's down from 19.5% growth in 2021 and the 27% growth we saw in 2020.
- The US is also saturated. It's the largest streaming market int he world at $29 billion. China is second at $11.4 billion
- Latin America is expected to be the fastest growing in the future, followed by Asia Pacific, EMEA and North America.|
- Ok so far, so not surprising.
- We've been telling you for years that everybody will jump into the streaming game until he market gets crowded and people start getting selective. COVID certainly accelerated that process but that's essentially hat we're seeing.
- Care to pick some winners and losers Brian?
What to Watch
‘Stranger Things 4’ Volume 2 Trailer : Vecna Vows ‘Your Friends Have Lost’ as Eleven’s Final Battle Begins
- Netflix dropped the official trailer for the final to episodes of the penultimate season 4 of Stranger Things coming July 1. Brian, where are you with Stranger Things right now?
Amazon’s ‘Lord of the Rings’ Goes Back to (Mostly) Practical Orcs After ‘Hobbit’ CGI, Plus Female Orcs
- Amazon's "The Rings of Power" EP Lindsey Weber told IGN that the series is returning to practical effects for Orcs. Visual effects will be used for minor tweaks or during action scenes when large numbers are needed. We're also going to see some female Orcs.
‘Beavis and Butt-Head Do the Universe’ Review: They’re Back for a Sequel, a Mere 26 Years Later
- “Beavis and Butt-Head Do the Universe” is the second movie in the franchise after "Do America'' which came out in 1996. 26 years ago. They time travel 25 years into the future where they meet their first smartphones. You can watch it on Paramount Plus.
Eyes On
Brian: The Boys: Deeper and Deeper
Tom: For All Mankind
On the Lookout: SGDQ started this weekend, raising money for Doctors Without Borders
Front Lines
Amazon’s Freevee Launches Two Free Streaming Channels From Fuse Media
- Amazon's Freevee, the one that used to be called IMDBTV has added a couple of free streaming channels from Fuse. Fuse Beat celebrates Black culture with movies, series and comedy performances. It's also available on Pluto, Roku, Vizio and Samsung. Fuse Backstage will feature music bios, performances, interviews and more for fans of music.
‘Elvis’ Beats ‘Top Gun: Maverick’ By $1 Million in Heated Box Office Battle
- In its fifth weekend in the theaters, Top Gun: Maverick passed the billion mark at the box office, in part thanks to $29.6 million from the US. That was good enough to make it number two, right behind Elvis which brought in $31.1 million.
Paramount+ announces plan for 150 international originals ahead of UK and Ireland launch
- Paramount Plus launched in the UK and Ireland June 22nd, bringing Star Trek back to those markets. The streaming service aims to expand to 160+ countries by fiscal 2023. And Paramount announced plans for 150 international originals by 2025.
Uncharted will fly out of a plane screaming and onto Netflix in July
- And if you didn't want to go to a theater to see Uncharted but you were kind of curious to see Tom Holland's take on Nathan Drake, the Uncharted movie arrives on Netflix in the US on July 15th.
Dispatches from the Front
Hi Tom, Brian, and Bryce,
Apologies for the late response to your conversation two weeks ago about Netflix and Roku. And since then, it sounds like it’s more likely that Netflix will be working with Google or NBCU for an ad-supported tier.
The discussion might be a bit moot now but figured I’d still throw in my two cents anyways. I guess my starting question though is why we think Netflix is so against being associated with having an ad-supported tier? They’ve publicly announced that they were doing so and we’re seeing many of the other big premium streaming services (Disney+, HBO Max, etc.) expand to ad-supported tiers as well. I don’t think consumers will react adversely, as long as the ad-supported version is at a lower price point than the current plan. The BIG difference between Netflix and all of those companies is that Netflix is not a traditional media company that’s built heavily on advertising (compared to ABC-ESPN-Disney, Discovery-Warner, Amazon, Google, CBS-Paramount, NBCU, etc.). For now, it seems like they'll be using advertising to help offset some costs, but they’re not quite yet turning into a more traditional media company.
So to the original discussion of whether or not Netflix would acquire Roku – unless they are looking to fully transition to an advertising-based media company, the costs of acquiring and running a whole new advertising division might just be a bit too high without them changing their entire business model.
Whether Netflix partners with Google, NBCU, or another company, I will be curious to what the terms will be. Is it going to strictly be limited to running ads on that lower tier or will Netflix also offer data of their non-ad tier users for targeting off-platform? I suppose we’ll find out soon enough!
All the best,
- Derrick
Brian mentioned on last week's Spoilering Time about how characters on "The Boys" shopping on Amazon took him out of the moment. That really didn't bother me, but I had a similar experience with another Amazon show "Reacher". One scene when they go to a person's house and ring the doorbell didn't produce the traditional "ding-dong". Instead we hear the very distinct chime of a Ring video doorbell. I immediately thought it was weird for them to go out of their way to not use some sound effects from a standard library. But then it dawned on me that it's an Amazon show and Ring is an Amazon brand.
- Jeffrey
Links
patreon.com/cordkillers
doghousesystems.com/v/rogue
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