With very little fanfare at all, Netflix has now completely removed their basic subscription option for Canadian subscribers. It’s an interesting twist on their year of plan redevelopment globally. Brandon Blake, our entertainment attorney from Blake & Wang P.A, has the full details.

No More Cheap Version Without Ads

By axing the ‘basic’ tier, currently priced at $9.99, the streamer’s answer seems pretty clear. New subscribers need to pay for the premium tier, or suffer through ads. There will be no middle ground for budget-conscious consumers.

For those already on the ‘basic’ tier, they can stay there until plan cancellation or a choice to move plans. For now, this seems to be a Canadian-only choice, with no news about an impending rollout anywhere else. Then again, there was no real news about this shift announced, either.

Market of Change

Perhaps it is worth taking this moment to remember that Canada was one of the first points of introduction for the newer Netflix ad-supported tier. It was also one of the first markets where we saw their password-sharing crackdown roll out. At this point it is no secret that they see the local as a good ‘test market’, of sorts, for the larger US domestic market, with similar interests and demographics. And at a time where Wall Street, particularly, is looking for profitability and revenue growth over other markers, the swing against password sharing is working well. Uptake of new subscriptions has boomed across the board as people lose access to shared subscriptions.

Is it a good sign for longer term growth, however? That will very much remain to be seen, in a year where all the major streaming players are doing what they can to grasp a slice of that profitability pie.

As streamers go, Netflix has always played close to its chest with its coveted viewership data. Now, with a shift in how they judge and report what data metrics we do receive from them, there could be a mass shakeup in viewership stats for their programming and other data. Blake & Wang P.A’s Brandon Blake, our expert entertainment lawyer, breaks the change down.

A Tech-Based Change

Instead of the hours viewed, a model which has been in play for Netflix and other streaming entities on platforms like Nielsen for upward of a decade at this point, Netflix will now simply report ‘views’. You don’t need much tech-savvy to recognize that as a term more commonly used on platforms like Instagram and YouTube then in Hollywood, and we can only assume that homogenisation is the idea behind it.

These new ‘views’ will be defined as the hours viewed divided by the total runtime of the content. While Netflix will still be reporting on the hours viewed model for some products, their Top 10 rankings and Most Popular lists will now use the new metric. We’ve also seen them expand their measurement window from the current 28 days to a broader 91 days, something that’s hoped to give their content more time to ‘grow’ with audiences.

Changed Rankings

This shift in how they use data has already significantly changed how those two lists appear. While Squid Game remains their most popular series to date, and Dahmer clung on to its third-place spot, Bridgerton pushed Queen Charlotte out of the number 4 spot, and both The Queen’s Gambit and The Watcher take new spots. Likewise, Inventing Anna and Lucifer have slunk out of sight. Wednesday zooms past Stranger Things 4 to take the title of most popular English-language series to date.

The move should correct some issues with the hours viewed model, however- namely allowing easier comparisons with other companies’ products as well as reducing the advantage longer-format content has over items like films and shorter series. It should also give series without a strong IP a good boost in the rankings, allowing it to increase organically in popularity over time. It’s not without pitfalls- namely the big one of assuming every user accessing content finishes it, so there’s in-built view count inflation. But it does better align with how third-parties like Nielsen report their data, which is a great development to see.

As Nielsen continues to reinvent and reestablish itself in a changing media market, what can we glean from its latest Top 10 charts? Blake & Wang P.A entertainment lawyer, Brandon Blake, walks us through the May 15-21 results.

Ted Lasso Takes a Bow

In many ways, the success of Ted Lasso for Apple TV+ was one of its breakout moments, even attracting awards attention. With the Season 3 finale looming large, especially as it could be the last for the series, it’s unsurprising to see it make an entrance into the Nielsen data, taking the 4th slot with 769M minutes viewed- its highest entrance to date. That may, of course, change quickly when we hit the actual finale!

Surprisingly, after a bit of a box office flop, Ant-Man and the Wasp: Quantumania also made its way to No 5 for Disney+ at 766M minutes, not bad for a film.

Netflix Tops, Again

Both Queen Charlotte, the Bridgerton spinoff, and new IP The Mother performed outstandingly well for Netflix, taking the No 2 (1.1B minutes) and No 1 (1.2B minutes) slots respectively. More unusually, NCIS took No 3 for both Netflix and Paramount+, as a dual-streamed program. We see a similar three-way split for S.W.A.T lower on the list (No 8), again showing across Netflix, Hulu, and Paramount+. Disney+’s Bluey is the only non-Netflix title lower on the list, with Cocomelon, A Man Called Otto, and Queer Eye finishing the Top 10 for them.

On the so-called ‘acquired programming list, we see another win for Prime Video with the consistent performer The Marvelous Mrs. Maisel, taking No 5 for that category and 443M minutes. Succession, unsurprisingly, continued to tick up with 550M minutes- and that is on HBO Max (now just Max) alone, without the HBO viewership considered as Nielsen doesn’t track it. Amazon’s Air also managed to make a solid showing at the No. 6 slot and 404M viewing minutes.

All in all, this particular Nielsen week was a grand one for Netflix despite Ted Lasso’s record, indicative of the firm hold the streaming platform still has on the market.

It’s strike season in Hollywood, or so it seems. With the WGA strike entering its seventh week on the picket lines, and the DGA only narrowly avoiding joining them with a last-minute deal last week, attention has now turned to SAG-AFTRA. And one thing is clear- if the bargaining parties can’t reach a deal by the June 30 expiration of their existing contract with the Alliance of Motion Picture and Television Producers (AMPTP) they, too, will be on strike. Entertainment lawyer Brandon Blake, with Blake & Wang P.A, explains this development.

Vote Passes at 98%

Negotiators received an overwhelming positive vote from their members for a work stoppage should negotiations fail, with fractionally less than 98% voting for a strike authorization. This doesn’t immediately trigger a strike, however. It simply means that negotiators have the power to enforce a work stoppage if their remaining time at the bargaining table fails to result in an approved resolution.

It is worth noting that 65,000 SAG-AFTRA members voted on this resolution- about a 48% turnout. However, this is a particularly large and rambling union, and it is one of the highest voter turnouts of recent years- the 2020 contract ratification only attracted 27%. It’s worth noting that this high strike authorization vote echoes that received by the WGA before their negotiations failed.

Can a Deal Be Reached?

Whether or not SAG-AFTRA will find themselves on strike is currently a million-dollar question for the industry. They have been very vocal in supporting the striking writer’s of the WGA. Yet so was the DGA, and they’ve managed to secure a future-forward contract for their members. The AMPTP also seems keen to head this strike off, which may give more negotiation power. SAG-AFTRA have only 3 weeks to seal a deal before their existing contract expires, in one of the most truncated negotiation periods of recent years. Generative AI usage and residual negotiations are expected to be the key sticking points in this round of talks.

For now, all we can do is wait and see what comes from the bargaining table- but this is one round of negotiations all eyes are likely to be watching, for sure.

We recently looked at a juicy new set of tax incentives on the table for shows filmed in the New York area. However, the New York State legislature this week called on the AMPTP to return swiftly to the bargaining table with the WGA with a veiled threat that the strike’s outcome could affect future funding of the tax incentive program. Blake & Wang P.A entertainment lawyer, Brandon Blake, has all the news.

Expanded Program

New York expanded their film incentives program from $400M to $700M as part of the state budget approved in April 2023. The recent threat is backed by 20 state senators and 34 members of the state Assembly, and encourages the AMPTP to return to the bargaining table as soon as possible, echoing many of the same talking points we’ve seen the WGA themselves raise since the strike began.

‘Essential to Well-Being’

The communication is surprisingly strongly worded, too, including the following statement:

“It is unacceptable for writers to have their earnings decline, in some instances as much as 23%, inflation-adjusted, in the last ten years while studio, network, and streaming companies’ profits soar.”

In the statement, they circle back to the number of tax dollars spent on AMPTP projects in the state, and lampoon the association for utilizing these credits but seeming unwilling to enter into ‘fair collective bargaining agreements.’ They also cite the number of WGA members living and working in the NYC area, and the importance of these careers to the state, and state:

“We find it distasteful that companies insist on hiring writers on a day-to-day basis in a race to the bottom to make employment in this area akin to the gig industry rather than treating members of the Writers Guild of America as the professionals they are.”

The message ends with a call to return to the bargaining table with a fair mindset on all sides. It’s perhaps the most powerful independent statement on the state of the striking industry we’ve seen to date. Will it have an impact? Dangling the future of their tax incentive program as bait may well get some attention, but so far, there seems to be little progress in ending the stalemate. We’ll keep you updated as things change.

2022 was not Netflix’s year. Despite the setbacks, however, it seems their decision to add an ad-supported tier to their subscription packages could be paying off in spades. With over 5M active monthly users for the new tier, it was a critical focus of their first TV Upfront presentation- and seems to have won Wall Street approval, too. Brandon Blake, entertainment lawyer Los Angeles with Blake & Wang P.A, has all the news.

Stock Price Jump

After their Upfronts presentation, despite a change to a virtual event at the last minute, Netflix stock jumped a rather mighty 9%. It closed at $371.29 on the back of supportive subscriber numbers and major growth for the new tier. Of course, it’s worth noting that those numbers are 5M active monthly accounts, not actual subscriber numbers- but then, Netflix has never been comfortable discussing its subscriber base in too much data-driven detail. And no doubt advertisers looking for a solid partner will be taking note regardless.

Other Positive Metrics

The news that over 25% of new Netflix subscriptions, with a median age of 34-prime targets for ad marketing-  are going to the cheaper ad-supported tier will be cheering news for Wall Street, too. Especially now the era of constantly booming subscription numbers is well and truly bust. That’s a lot of traction to gain in only half a year of availability, especially with a notoriously rocky start.

On the ad member side, we’ve heard that it has ‘more than doubled’ this year alone. Interestingly, Netflix has managed this off the back of a programming lineup with zero live marquee sports programming, too- something that has become a key hope for subscription increases on other streaming platforms.

While there’s still a long way to go before Netflix recovers the peak of its share price, let alone public goodwill, it seems they launched their ad-supported tier at the perfect time for the market. And in a year riddled with advertising and subscription downturns both, that- and Netflix’s notoriety as one of the few streamers operating in the black- is news worth celebrating.

With Wall Street turning away from subscriber numbers to focus on profits and sustainable balance sheets, Peacock was known to be in an unenviable position. While all of the streaming platforms bar Netflix itself are still finding their way into the black, Peacock’s deepening losses and slow growth have been working against it for a while. With the news of another steep and painful loss for Q1, and no real sign of it turning around any time soon, does this mean Peacock could find itself on the chopping block as we inevitably see shrinkage in the streaming market? Blake & Wang P.A entertainment lawyer, Brandon Blake, unpacks the news.

$700M Loss

Unveiled as part of the wider Comcast earnings update, Peacock managed a staggering $700M loss in Q1 despite an upward turn in subscriber numbers. Now at 22M, a 60% increase on the same period last year, it wasn’t enough to match operating costs. Peacock’s revenue total was $685M, significantly behind the EBITDA loss of $704M.

2023 was predicted to be the peak of Peacock’s losses, and it seems they weren’t exaggerating! It’s currently estimated they could turn in an overall loss of $3B this year.

Overall Declines

While the overall Comcast balance sheet looked a little better, it still hasn’t brought anything to the table to get excited about. Overall we see their content and experiences division drop by 9.5%, with adjusted earnings ending flat. The studio division did see a 13% upturn, but the advertising division turned in a dull 21% drop on the back of a tighter advertising environment. With an unanticipated high-level departure in their ranks, too, it seems Peacock has a lot of ground to regain if it wants to make a case for itself as a true streaming competitor.

While execs were keen to write these dull returns off as just an expected part of the business, it’s hard to see a compelling argument for that competitiveness at present. Unless 2024 brings considerably better things for the platform, Peacock may yet find itself on the streaming chopping block.