Inside Netflix s risky bid for world domination

20 April, 2016 - 07:01

Netflix flexed its original programming muscle at a press event in Paris last week, bringing stars like Ashton Kutcher, Kevin Spacey and Ricky Gervais on stage to talk up its programming for the next few months. The company will spend around US$5bn on content in 2016 and plans to launch 600 hours of original programming during the course of the year. by Lance Harris

As it positions itself to compete with the premium cable channels in the US and to conquer the international market, Netflix's approach to TV programming is changing what sort of shows get made as well as how the content is structured. CEO Reed Hastings said that the goal is to return content to the original binge experience - reading a novel. Like a book, a show on Netflix should be able to go with you to the beach, your living room, or on an aeroplane.

Netflix has come a long way in a short time, focusing much of its original content on the long tail of television fans rather than on mass viewership. Though Netflix hasn't yet produced a show with quite the prestige of, say, FX's Fargo, AMC's Breaking Bad, or HBO's True Detective and The Wire, productions like Orange is the New Black and House of Cards have become pop culture staples.

Less interesting than the quality of the shows is the impact the shift to Internet TV has on how television is packaged and consumed. The fact that shows are streamed on demand means that writers, directors and producers have more flexibility than broadcast TV allows them. With House of Cards, for example, Netflix ordered two series from Spacey and his collaborators David Fincher and Beau Willimon without first commissioning a pilot.

The new watercooler moment

We pitched the idea to all the networks. Every network thought it was an interesting idea and every network was engaged but every network insisted we do a pilot except one, said Spacey. Netflix gave us as creators a really long runway to tell the complex story we wanted to tell. And even more radically, Netflix released the entire series at once for binge-viewing. The watercooler moment is the entire series, Spacey said.

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Kevin Spacey takes creative control

Suddenly, shows don't to be written with contrived cliff-hangers to bring you back next week in prime advertising time to find out what happens next. There are no recaps in case you missed last week's episode. And if an episode is 10 minutes longer or five minutes shorter than usual, it doesn't matter because there aren't advertisements or a programming grid dictating the length of the show. Shows also need to be deeper and more re-watchable, because they'll live on the online platform for a long time.

For Netflix, the question isn't whether you'll watch House of Cards or Daredevil during primetime, but whether you like the show enough to buy a subscription. It's about having something in the line-up for everyone, rather than one or two things everyone will like. They are servicing consumers rather than advertisers, said Kutcher during a panel discussion. They're not just putting [a show] in a slot and crossing their fingers.

Netflix doesn't disclose viewership numbers for its shows, a choice it says protects the integrity of its content and spares content creators from anxiety. Benchmarking shows against each other by the number of people who watch them is a horse race that deteriorates the quality of programming, said Ted Sarandos, Netflix's chief content officer. Without advertising sales, shows don't need to resort to excess and sensationalism to drive spikes in viewership.

Niche audiences

In addition to the crowd-pleasing hits, most which have a slightly soapy scent or a faint reek of TV movie of the week, Netflix is investing large amounts of money in shows that are fairly niche. It picks up series orphaned by mainstream TV networks - the zany Unbreakable Kimmy Schmidt and revives old favourites with cult followings like Arrested Development and the Gilmore Girls.

Netflix also doesn't shy away from difficult or esoteric content - it shops for content at festivals like the US indie showcase, Sundance, and put its full backing behind Beasts of No Nation, a child soldier drama that had a strong showing at most of the global awards. Later this year, it will stream the cheery sounding Khmer Rouge true-life drama, First They Killed My Father, directed by Angelina Jolie.

Behind the scenes, it's the growing global subscriber base and the focus on data and personalisation that makes it financially feasible for Netflix to invest in content that has a relatively narrow appeal. Its algorithms try to match viewers with content they'll like - each subscriber sees a different profile gate suggesting content he or she might enjoy. Eventually, it hopes that you won't see any recommendations that don't match your tastes.

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Ashton Kutcher says Netflix services consumers, not advertisers

These suggestions often target micro-genres such as political dramas set in Washington, DC or films with a strong female lead. There's a human side to the big data - Netflix employs around 30 part-time taggers around the world to break films down by their genre, lead actors, setting, tone and other elements so that they can be categorised into highly specific subgenres.

Ricky Gervais, whose feature, Special Correspondents, debuts on Netflix on 29 April, said that the company's rise signals the return of the auteur and the end of content-by-committee. The comedian said Netflix's reach into a global audience of 75m subscribers allows him to get a large audience, but with no compromise to his content.

A lot of comedies now are gross-out, lowest common denominator, and that's because [film studios] want to everyone to go to

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