Notable writers and actors push for some common issues as they seek better contracts from the media companies represented by the Alliance of Motion Picture and Television Producers. One big one: Both unions want more transparency about how many people watch streaming series and movies and, in addition, a larger share of streaming revenue through residuals or success-based metrics. That’s a marked change from the early days of the streaming boom, when letting go of the bottom-line nature of Nielsen ratings was often seen as a selling point for streaming services over broadcast or cable TV channels.
“Since streaming networks don’t release numbers, luckily quality trumps ratings,” showrunner Sam Esmail told me The Hollywood reporter in 2018, when he launched the series Homecoming for Amazon Prime Video. From season two of Stranger thingscreators Matt and Ross Duffer joked that they had no idea what a hit is, “but Netflix does.”
In addition to placing Nielsen numbers in the rearview mirror, the early years of the streaming era also offered the promise of shows being available indefinitely: The mid-2010s was a peak time for much-loved but marginally-appreciated shows being “rescued” or revived (eg Arrested development on netflix, The Mindy Project on Hulu or Community on Yahoo). Large and growing libraries at Netflix and Hulu also suggested that any number of classic shows would never be more than a few clicks away — and, from a business point of view, that the people who made those shows would continue to receive residual checks from streaming users. she looked.
The explosion in the number of series – scripted television in the US grew from 288 shows in 2012 to 532 in 2019, mainly driven by streaming – meant work for more writers and actors. That, in turn, made it easier to see past details like data transparency (so did larger upfront payouts, even if it meant getting little to nothing on the back end), as the industry scrambled to embrace the streaming model , which also promised freedom. of network notes and the grind of making 22 episodes per season on the traditional broadcast model.
A few Cassandras, largely in the media covering the TV business (myself included), wondered how it would be possible to know if a program was successful on streaming if there wasn’t an agreed-upon way to tell how many people looked at it. . Nielsen was (is?) no match for that kind of measurement, and when Netflix chose to black box its viewership data, everyone else with some form of streaming ownership — from Amazon to The CW — followed suit.
The tide has definitely turned. As one lawyer negotiating deals with studios and streamers puts it, creators were focused on money and creative freedom that streaming promised in the 2010s, but the slowing subscriber growth and pressure has come to an end in recent years from shareholders to continue publishing great quarterly results. the spending crack. “We let the wolf into the chicken coop, and we regretted it for a long time,” says this lawyer.
With the tighter budgets came a wave of reversed series orders and stopped renewals, which continue to happen today, along with the outright removal of dozens of library titles from streaming services. These “write-downs,” in CFO parlance, allowed companies to write off the cost of producing those shows, but they also undermined both the implicit promise to viewers of “anytime, anytime” and blocked the remaining payments – no matter how small they had been. – to anyone who had an interest in all those vanished shows and movies.
Even as prominent a name as Steven Soderbergh, who has created several projects for Warner Bros. Max streamer. Discovery, said he only gets “adjectives” — as in “We feel good about the numbers” — from the company when describing how his job works. Has performed.
“There are two possible reasons why we are not getting all the information,” the filmmaker said in an interview with Defector. “One is that they’re all making way more money than anyone knows, and they’re willing to tell us. The other is that they make much less money than anyone knows. And they don’t want Wall Street to look under the hood of this case in any significant way, because there will be a reckoning that will be quite unpleasant.”
The hoarding of enterprise-level data has also made it more difficult to find a cross-platform streaming currency that the interested parties can agree on. For all the flaws in Nielsen’s linear TV rating system, it’s at least an agreed-upon mechanism that doesn’t depend on the good faith of the companies it measures.
The lack of transparency and a reliable way to objectively measure success in the streaming age has become a bone of contention in both Hollywood strikes. The AMPTP’s latest counteroffer to writers would release quarterly reports of total viewing time for streaming series to the Writers Guild of America, “to develop proposals to restructure the current SVOD rest regime going forward” — but apparently not in the contract writers . now try to win. Studios and streamers have also flatly rejected SAG-AFTRA’s idea of using third-party metrics in a revenue-sharing proposal (although the actors’ union says it would be more than happy for the companies to open their books instead) .
Another attorney with industry ties notes that under the old television model, actors and writers could participate in a show’s success through adjusted adjusted gross revenue. They could also use ratings to increase paydays in renegotiations. Now they may not even know if a series they are working on is successful. Meanwhile, backend deals have almost dried up for everyone except the most famous creators and stars, and general deals are seen as the path to safety – but there aren’t many of them.
As the strikes continue, calling for more transparency, a narrative has developed that says streamers’ reluctance to share numbers has more to do with hiding failures than downplaying hits – as Soderbergh said in his interview suggested – fearing that stock prices would plummet. if people found out how little attention some titles attract.
“This is Hollywood. No one hides success. Exaggerating success is a characteristic of our company,” says the first lawyer THR. The most likely explanation for the opacity, he suspects, is that “the data is not good, and the studios are hiding it because revealing it would bring down the whole house of cards.”
The streaming industry has become more like traditional television in recent years, with ad-supported services as the new growth area – free platforms like Fox’s Tubi, Amazon’s Freevee and Paramount Global’s Pluto TV have seen their usage grow by double digits. percentages over the past year. Studios and streamers are also increasingly looking for stories with broad appeal, rather than stories with a small but dedicated audience. It feels like a throwback to the days of linear television, even as streaming has overtaken both cable and broadcast networks by occupying a larger share of viewers’ time.
But the issue of transparency lingers: A few high-profile writers recently took to social media to note that Netflix has signed agreements (in line with a European Union directive) in several countries, including France and Germany, that pay extra success-based royalties for local productions.
***
A timeline of (non)transparency
Streamers seem to be slowly moving away from total coverage, but to what extent?
February 1, 2013
House of cards, the first series produced exclusively for Netflix, premieres. Netflix does not release viewing data.
Circa 2013-2014
HBO and other premium cable channels are beginning to report selective cross-platform ratings, including on-air, delayed viewing and streaming totals.
2016
A few third-party analytics companies are starting to release some streaming data – heavily disputed by the streamers themselves – showing the Netflix data, among other things Full house be a big hit.
November 2017
Nielsen, the largest player in linear TV ratings, releases its first set of streaming data for shows, among others House of cards and Marvels Defenders.
January 2019
Netflix is revealing a small amount of data for the first time — based on a standard of users watching 70 percent of a movie or 70 percent of one episode of a series — in its quarterly earnings report.
September 2020
Nielsen begins publishing weekly top 10 lists for streaming titles. The Umbrella Academy topped the inaugural chart.
June 2021
The meter, a monthly snapshot of TV usage by platform from Nielsen, launched – with buy-in from Netflix and other streamers, marking a major shift in their attitude to the rating service.
November 2021
Netflix debuts its own weekly top 10 list (which later dates back to the end of June of that year).
August 2022
Amazon and Nielsen strike a deal that will allow the latter to provide ratings Thursday night football on Prime Video, marking the first time a live streaming program has been part of Nielsen’s national TV tally.
This story first appeared in the September 6 issue of The Hollywood Reporter magazine. Click here to subscribe.
