Streaming Platforms Open to Licensing Deals to Cut Costs
By Movieguide® Contributor
Small and mid-sized streaming platforms have started to license their content out to larger streaming platforms – primarily Netflix – as a new way to generate more income and save costs.
These deals have also increased the licensed content’s visibility, leading to a bump in their popularity.
SUITS, for example, had been available on Peacock for years with little fanfare or notoriety. However, once it was licensed to Netflix, it exploded in popularity. HBO shows such as BAND OF BROTHERS and SIX FEET UNDER saw similar, albeit less explosive, bumps as well when they were licensed to Netflix.
“It’s a reflection of our recommendation system and what we do best,” said Ted Sarandos, Netflix’s co-CEO, adding, “I don’t know that it will happen in reverse. I think we add value when we license content; I’m not positive that’s reciprocal.”
Licensed content is already a major focus for streaming services. Earlier this December, Netflix released a massive report, providing data on over 18,000 titles – representing 99% of all viewing on Netflix. Per this report, licensed shows and movies accounted for 45% of the time spent on the platform during the first half of 2023.
The Streamable reported, “…this pivot [to licensing] is likely to lead to a reduced number of originals titles on linear and streaming platforms.”
And while Netflix places a heavy emphasis on its original shows and movies, licensed content is core to the company’s business. This is even more true for other streaming services.
Former ABC and NBC research and scheduling executive Mitch Metcalf analyzed over 22,000 streaming titles tracked by Nielsen over October and November to find that roughly 75% of streaming time over that period was spent watching licensed shows and movies.
As streaming enters a new era and platforms focus on profits, it is clear that licensing will become even more central to the business. While platform exclusivity was once the norm, shared content across platforms will now have its day as all parties benefit from this new approach.
Movieguide® previously reported:
For the first time, Netflix is sharing viewing data in a report titled “What We Watched: A Netflix Engagement Report…”
The platform has been successful in boosting library titles like SUITS, which saw a resurgence on Netflix in 2023. Yet, Sarandos revealed that the company has no interest in licensing its original content to competitors.
“What’s interesting is a show like SUITS, which has been played on USA for a long time, has been available on Peacock and has been available on Amazon for a couple of years before it hit Netflix, and yet we were able to unlock this enormous global audience for it,” Sarandos said. “And that’s the combination of our large subscriber base and our recommendation system that knew to put ‘Suits’ in front of people who were going to love it the most.”
He went on to say that he did not think “that would necessarily happen in reverse” and that going elsewhere was “not part of our business plan.”
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