A new deal between Hollywood studios and writers will for the first time require streamers like Netflix, Hulu and Disney+ to report viewership numbers of original and syndicated content, shining a light on what experts have called a “black hole” of information that has allowed companies to largely avoid justifying in-house programming decisions.
KEY FACTS
A new contract negotiated between the Writers Guild of America union, which ended its 148-day strike on Wednesday, and the Alliance of Motion Picture and Television Producers will force services to report to the union how many hours a show has been streamed domestically and across the world, a first for a collection of streaming companies that have historically kept a dark veil over the information.
Apple TV+, Amazon Prime Video, Disney+, Paramount+, Netflix, Hulu and HBOMax are among the companies that have shared what the Verge called “weird metrics or meaningless self-referential rankings” instead of the actual viewership data available for broadcast networks and cable channels like ABC, NBC, CBS, ESPN, Fox News, CNN and others.
The data was a sticking point in the tense union negotiations as writers called for measurable performance metrics that could be translated into residuals—long-term payments sent when their show or movies rerun or are purchased—for union members who work on hit shows.
Writers have for decades been paid every time their show or movie is re-aired on its original network or on cable television, or when someone buys a DVD, but that stopped on on-demand streaming platforms, and writers who’ve had network shows become popular on streaming services complain they have not been adequately compensated for its secondary success on those platforms.
It’s possible the numbers studios provide will be subject to nondisclosure agreements and therefore not released to the public, but the WGA may still be able to release aggregated data.
Representatives for WGA, Netflix and Hulu did not immediately respond to Forbes’ request for comment Wednesday.
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CRUCIAL QUOTE
Not knowing the numbers is “very frustrating,” said Gloria Calderón Kellett, the co-showrunner for Netflix’s reboot of One Day at a Time, which was canceled. “Because you just don’t know what you don’t know. You are in this black hole.”
KEY BACKGROUND
Historically, a lack of data has led to a lack of accountability for streamers when it comes to making programming decisions. Without viewership information, Nexflix and other companies have been allowed to make decisions on canceling and renewing projects without any transparency, and they can claim a project has or hasn’t been successful on a whim. Viewers have expressed discontent about the cancellation of shows that seemed to do well in the public eye—like Daredevil, Warrior Nun, The OA and Inside Job—only to be shut down by the streamer. It has also shielded companies from having to admit when a high-budget show flops. Netflix CEOs Ted Sarandos and Greg Peters told Bloomberg earlier this year that the streamer has “never canceled a successful show.” Netflix is slightly more transparent than its competitors, it does provide a weekly top-10 breakdown of the top movies and shows by country, but it only covers the most popular programs and provides no indication as to what isn’t doing well. Others, like Disney+, will on occasion release how many people watched a popular show’s premiere or finale but not in any kind of context to other services or shows on the same platform. Nielsen, the media data company that tracks viewership behavior, provides a top-10 list of streaming platform ratings based on the devices people use to stream (think smart TVs or video game consoles).
BIG NUMBER
15.2 million. That’s how many views Netflix says its original film Love At First Sight, the most-watched English movie of the week, got between September 18 and September 24.
TANGENT
Sharing streaming data with the public could put publicly traded companies like Netflix, Disney and Paramount in the hot seat when it comes to their shareholders. Michael Smith, a professor of information technology and marketing at Carnegie Mellon University, told Forbes he doesn’t think sharing the data privately with the WGA will have a dramatic impact on how stocks perform, but that they could be impacted if the world knows an expensive project ultimately flopped. Measuring the performance of a streaming company now is largely based on revenues, costs and an aggregate number of subscribers (which not all streaming services have made public), Smith said, but streamers have fought tooth and nail against revealing streaming data because of a potential impact to share prices. He added that streamers differ from traditional broadcast channels that rely on viewership numbers to sell ad space, while platforms like Hulu have more flexibility in their advertising options. “I think this is the most interesting part of the (WGA) deal,” Smith said.