Netflix Looking to Become World's Largest Buyer of Original Content9 Dec, 2014 By: Erik Gruenwedel
CCO Ted Sarandos says movies are being displaced by TV — with the SVOD pioneer aiming to bow original programming every two weeks
Global access and original content launches every 14 days are among Netflix’s five-year goals, chief content officer Ted Sarandos told an investor group Dec. 8 in New York.
Speaking to a packed assembly at the UBS 42nd Annual Global Media and Communications confab, Sarandos was hailed for having a “pretty cool job” spending more than $6 billion this year on content rights. Indeed, Netflix’s program costs are all the more unprecedented in that the subscription streaming service only recently began acquiring content.
The CCO said the reason for increased spending on original programming, including feature-length movies, is distribution, and more importantly, control of that distribution. Specifically, Sarandos rails against a TV ecosystem predicated on the weekly episode, and a movie business beholden to the box office window.
Netflix recently sent theater owners into a tizzy when it announced it was partnering with the The Weinstein Co. to co-produce Crouching Tiger, Hidden Dragon: The Green Destiny, sequel to the 2000 Oscar winner Crouching Tiger, Hidden Dragon. More importantly, Netflix said it would stream the movie day-and-date with its theatrical 2015 launch on select Imax screens. Theater operators have said they will bypass the movie.
Netflix also announced a four-movie deal starring and co-produced with comedian Adam Sandler that will stream simultaneously with any theatrical launch.
Sarandos contends consumers should be able to watch content on their terms, which includes binge-viewing and on-demand movies. Sarandos said ubiquitous access is in part what led to the cancellation of the Netflix/Starz distribution agreement in 2012.
He said the billion dollars earmarked over the life of the five-year Starz agreement is better spent trying to accelerate the distribution window for movies and producing original TV fare.
“I think it has less do to with the quality of television, the lack of quality movies and more with a really lousy distribution model for movies,” Sarandos said.
Original Series Coup
With Netflix launching service next year in Australia and New Zealand, the SVOD service takes another step toward global access. At the same time, sustaining subscriber growth and retention in new and existing territories requires feeding an almost insatiable appetite for content, according to Sarandos.
The CCO said Netflix secured two of the top episodic programs of the year: “Better Call Saul” and “Gotham” — the latter’s global pay-TV rights acquired before the first episode aired Sept. 22 on Fox.
“We see this [as Netflix becoming] the first global buyer of programming. We’re operating in 50 countries … and we went in preemptively and worked on those deals because of our confidence in [producer] Warner Bros. Television’s commitment to making ['Gotham'] a great show,” Sarandos said.
“Better Call Saul,” which is a prequel to the blockbuster cable series “Breaking Bad” (produced by Sony Pictures Television), launches on AMC Networks Feb. 8, 2015. Netflix has exclusive pay-TV rights to the series outside North America.
Similarly, through its pending landmark pay-TV deal with Walt Disney Studios, Netflix is already streaming animated hit Frozen in Scandinavia.
Sarandos said the prequel of “Breaking Bad,” written and produced by series creator Vince Gilligan, and staring most of the original cast in special appearances, is a “pretty safe bet.”
Netflix currently is in production in Brooklyn, N.Y., on the first of five original series based on Marvel superhero characters. Sarandos said early feedback on “Daredevil,” starring Charlie Cox (“Boardwalk Empire”) and Vincent D’Onfrio (“Law & Order: Criminal Intent”), among others, has been positive. The series is slated to launch next May.
Meanwhile, nautical period series “Marco Polo,” co-produced by The Weinstein Co., streams exclusively on Netflix Dec. 12, and stars Lorenzo Richelmy in the title role.
“I think what’s more precedent-setting is multi-territory global buying … fueled by the encouragement that most of the viewing in every territory we operate is on U.S. content,” Sarandos said.