For years, Netflix executives have been TV bingeing’s biggest cheerleaders.
The Los Gatos streamer pioneered the release of all episodes of a show in one go, allowing people to sit in front of their screens for hours to consume entire seasons in one weekend.
But on March 4, the Hollywood disruptor will begin his foray into a format as old as broadcasting itself – live programming – with a highly anticipated comedy special from Chris Rock.
Rock becomes the first artist to perform a live comedy special on Netflix with his show, titled ‘Chris Rock: Selective Outrage’. The roughly hour-long special could draw a large audience to the streaming service, as fans expect it to discuss Will Smith who slammed him at the Academy Awards last year. There will also be a pre-show and after-show with other entertainers including Ronny Chieng, David Spade and Dana Carvey.
Netflix’s binge-and-burn model has made it the largest subscription streaming service, with approximately 231 million paying members worldwide.
But with the market flooded with rival streamers, it’s no longer enough to simply have a large library of shows and a range of popular original programs available on demand. Netflix is looking at ways to turn its shows into must-see events.
Under pressure to control costs while growing their business, Netflix and other streaming services have canceled shows and laid off employees. At the same time, Netflix has been trying new types of content (including games) and borrowing from some of the old ways of the TV business, such as advertising.
Participating in live shows — an effort to encourage old-fashioned appointment viewing — is part of that effort to fend off competition and increase viewership.
“Netflix is looking for ways to be competitive and to show consumers why they should stay subscribed to Netflix because there are so many choices now,” said Brett Sappington, vice president of Culver City-based market research firm Interpret, which advises businesses in media, technology and entertainment. “Netflix now has to prove every month why it’s still valuable.”
Netflix declined to comment.
By dipping its toe into the live TV space, Netflix is discovering what traditional broadcasters and cable have understood for generations. Events like the Super Bowl or World Series are popular among viewers because it’s an experience everyone can talk about in real time.
And while ratings for awards shows like the Oscars have dropped over the years, they still attract millions of viewers and spark conversations in the culture because, as last year’s awards show proved, anything can happen in a live setting. That might similarly prompt people to tune in for the Chris Rock special, which takes place nearly a year after the infamous Oscars incident.
“Live is able to engage consumers in a way that on-demand just doesn’t in volume,” Sappington said. “If you can only see it on Netflix, then everyone who saw it should go to Netflix to make sure they’re part of it. They don’t want to miss anything.”
Last year, Netflix hosted an in-person comedy festival with 336 comedians performing in Los Angeles and selling more than 260,000 tickets. During one of the performances, comedian Dave Chappelle was tackled by a man with a replica gun at the Hollywood Bowl. Rock later quipped onstage, “Was that Will Smith?” Netflix also signed a deal to stream the annual Screen Actors Guild Awards on Netflix starting in 2024.
“There’s nothing special about live television, but we’re working on it, starting with our Chris Rock live concert, trying to create the excitement around live for those things that are more unique about being live,” says Ted Sarandos , Netflix’s co-CEO, in a income discussion in January.
Other streaming services have already bet on live events. Paramount+ co-televised the Grammys with CBS in February, while Disney+ broadcast a live Elton John concert from Dodger Stadium last year.
A major area of interest for streamers is sports, long seen as the final frontier for online video – and one of the last things to keep the traditional cable bundle intact.
Amazon pays $1 billion annually to stream 15 Thursday night NFL football games, while Apple TV+ has agreements with Major League Baseball and Major League Soccer to carry games.
Netflix has resisted the urge to dive into live sports, a business that comes at an astronomical cost due to the licensing fees popular leagues can charge for broadcast and streaming rights.
“We haven’t been able to figure out how to make a profit renting major league sports in our subscription model,” Sarandos said in January.
Instead, Netflix is going down its tried and tested route of stand-up comedy, a category it has long invested in and promoted.
Netflix’s comedy specials have sometimes sparked controversy, including within the company. Netflix employees walked out in protest over how the company handled their concerns about transphobic speech in Chappelle’s “The Closer” special. Ricky Gervais’ comedy special “SuperNature” was criticized by GLAAD for “explicit, dangerous, anti-tran rants masquerading as jokes.”
But people still tuned in — “The Closer” was in the top 10 Netflix shows in four countries for at least a week, while “SuperNature” reached that level in 13 countries, according to Netflix data. The company updated its culture memo last year to say its library may contain content that goes against the personal values of some employees. “If you’re having a hard time supporting our broad content, Netflix may not be the best place for you,” the memo read.
Saturday’s event is Netflix’s latest development in stand-up comedy, known as a personal passion for Sarandos. It is Rock’s second comedy special on Netflix, following 2018’s “Chris Rock: Tamborine.” Netflix paid Rock $40 million for the two specials, according to the Hollywood reporter. Netflix declined to confirm the cost of the deal.
Michael Pachter, a director of equity research at Wedbush Securities, questioned whether the viewership for Rock’s special will justify the cost.
“There’s no way they can get $20 million back for an hour of comedy,” Pachter said.
Over the past few years, Netflix has been building out its live programming technology, but “hadn’t really tried it out yet,” Sarandos said at an investor conference in December. Sarandos has suggested that this could lead to live streams of other Netflix events, such as episodes revealing the winners of a competition show or a reality show cast reunion.
