With the return of the fourth season of the Netflix original series Orange is the New Black, the industry-changing transformation of Netflix from a Blockbuster alternative, to a streaming service, to a competitive substitute for network distribution as well as a veritable production company warrants a nod. Content is a powerful force indeed, and Netflix has largely used that power to the company’s advantage. But can Netflix maintain its quality even as it becomes incredibly successful?
A Brief History of Netflix
Just a reminder – we didn’t always live in an age where the Pope was invited to a “Netflix and Chill” festival. Netflix started out as a DVD-by-mail service in 1998 and didn’t begin streaming until 2007. Its first original series aired in 2012.
At the time, the move to content creation was as much out of necessity as it was innovation. The company was receiving content from HBO, AMC and other networks, but Netflix CCO Ted Sarandos noted that, in the wake of crumbling negotiations with networks like Starz over the issue of licensing fees, it was only a matter of time before these networks started branching out and creating streaming services of their own.
The only move, then, was to create content that Netflix could fully control without the threat of losing subscribers right alongside network deals. And it paid off. In 2014, the June release of the second season of Orange is the New Black coincided with a 9% spike in unique visitors for Netflix that month. And in June 2015, when the third season was released, Netflix scored a 13% month over month increase in unique visitors.
Netflix’s original content is not restrained to genre, or series. Take into account original films like the celebrated Beasts of No Nation and Ricky Gervais’ recent project, Special Correspondence. Netflix has also heard your cries, read your online petitions and scoured the depths of Reddit to bring back cult favorites like Arrested Development, Wet Hot American Summer, Fuller House and Gilmore Girls.
One Choice Too Many
While many of these projects have enjoyed commercial and critical success, all of a sudden it seems like Netflix is beginning to flood the market. The company has gone from producing just a few award-winning shows – each of which led to more and more buzz surrounding the release of the next original – to gearing up to release upwards of 30 new shows and movies in 2016 alone, and scheduling many more for 2017 and 2018.
In a lot of ways, this is great news. More content means more options, right? But it also means a sort of sensory overload. We’re almost back to the days of broadcast television in terms of endless options, channel surfing and indecision when it comes to what program to binge watch alone on a Saturday night over a tub of Ben & Jerry’s.
In fact, if you’re going to hold to Barry Schwartz’s notion of the Paradox of Choice, more choices can often just lead to reduced satisfaction with whatever decision we make in the end. Meaning Netflix is putting itself in a no-win situation. Gone, it seems, are the days when a Netflix original series was almost guaranteed to be a unique and carefully conceived project. For now, at least, the quality of its programming is suffering simply because of its demand for quantity. If you’re in any doubt that this could be true, just check out The Ranch.
It might be better for Netflix to slow down and rediscover its more indie and carefully cultivated roots. As personalized as it attempts to make program suggestions, some brilliant content could be getting lost in the clutter, and with it, the brand power of the “Netflix Original” tag.
Why This Matters
Consider, now, that Netflix spends millions – comparable to what it could spend on a whole library of shows – to develop just one season of an original series. Renewing a popular series gets even more expensive. Despite earning $6.78 billion in 2015, Netflix’s profits were just $2.19 billion. The spend on programming is huge, so beyond the simple question: “will Netflix ever make another Orange is the New Black-quality show?” is the question: “Can it afford not to?”
In order keep up with the costs of original programming, there are few other options than to increase the cost of the service, maybe by $1, maybe by $2, which may evoke stress dreams of the Qwikster debacle. Regardless, an increase in price means Netflix will lose at least some subscribers unless it can create content so good that they have to stay – a gamble that becomes more serious with every advancement in HBO Now, Amazon Prime Video and countless other streaming/content creation studios following Netflix’s lead.
Unfortunately, it doesn’t look like Netflix plans to go the “slow down” route anytime soon, and might end up devouring itself in the long run instead. Spending too much on content that people don’t want to pay that much to view. Think – the end of Aladdin when Jafar wishes for the infinite power of a genie, but ends up getting trapped in the little lamp that comes with it. Ambition has a tendency to do that to people. And brands.