Netflix CEO Defends Show Cancelations In The Wildest Way
The new Netflix Co-CEOs insist they have never canceled a successful show, explaining what makes a series a hit in the eyes of the streaming service's management.
Though Netflix has remained wildly popular for the past two decades, fans have often criticized the streaming service for canceling beloved shows. In an interview with Bloomberg, Netflix’s new co-CEO duo, Ted Sarandos and Greg Peters, set the record straight about Netflix show cancellations. According to them, the streamer has never committed an unjustified axing.
“We have never canceled a successful show,” Sarandos said. “A lot of these shows were well-intended but talk to a very small audience on a very big budget. The key to it is you have to be able to talk to a small audience on a small budget and a large audience at a large budget. If you do that well, you can do that forever.”
Netflix is entrenched in the same uphill battle as all its competitors, fighting to strike the balance between quantity and quality in an uncertain economy. Maximizing profits in uncertain conditions has left streamers like Netflix and HBO Max to adjust pricing models and make cancellations that are unpopular among loud minorities. According to Sarandos, these decisions are all about the numbers.
Netflix makes a lot of shows, and cancellations are inevitable. That’s because Netflix’s goal is to be a one stop shop for viewers. Sarandos said he views Netflix as a combination of the most popular channels, like HBO, Lifetime, and the Food Network, and the goal is to provide the variety of cable on a single platform.
Creating a catalog that encompasses the specialties of a wide range of successful cable channels is no small task, especially when a large percentage of that catalog is from scratch. As Netflix seeks to put out the best versions of every type of show, they spend a lot of money. That has led Netflix to set a very high bar for shows to hit in order to avoid cancellations.
In addition to touching on the Netflix cancellations policy, Sarandos and Peters discussed another big problem the streamer is looking to tackle: account sharing. The duo hinted at a coming policy that will limit people’s ability to share Netflix accounts across different households. While they anticipate that the coming changes (which they said will be gradual) will be unpopular among some, they also believe that the value of Netflix will draw those customers back in and the number of account holders will ultimately go up.
Mitigating account sharing has been a topic of discussion for Netflix for a long time. If they can figure it out, the streamer could be looking at a huge increase in subscriber revenue. Conversely, they could drive a huge portion of their viewers away, and remaining Netflix viewers may be subjected to more outrageous show cancellations as a result.
For Sarandos and Peters, content is still king. “But if we deliver a Wednesday every week, if we deliver a Glass Onion every week,” Peters said, “we’ll get the vast majority of those viewers back.” Marquee hits like Wednesday, Stranger Things, and Squid Game are the types of shows Netflix is looking to kick out on a regular basis, and a more focused approach could yield fewer cancellations.
The CEO duo of Sarandos and Peters is a new look for Netflix as they have now officially succeeded former Netflix CEO Reed Hastings in a relatively smooth transition of power. This transition serves as an interesting contrast to the tumultuous restructuring happening at Netflix competitors like HBO Max and Disney. For Sarandos, there is no mystery behind the contrast.
“It’s easy to talk about streaming in one big, broad brush, but there is Netflix and there is everyone else trying to figure out how to do what Netflix is doing,” Sarandos said. There may be some truth to that, but as Netflix spends big bucks on inevitable cancellations, competitors like Amazon Prime Video and the upcoming new and improved HBO Max look to continue their assaults on Netflix’s streaming domain.