© Unsplash/Sayan Ghosh
If Google has a bad reputation for closing apps or services, Netflix regularly cancels series. And among the series canceled by Netflix, we can find popular titles, which received good reviews. We could cite the example of Shadow and Bone which, after the second season, was canceled by SVOD. However, according to an article in Variety, season 2 reached second place in the SVOD Top 10 and accumulated 50 million hours of views in one week.
There are several reasons that can lead to the cancellation of a series, but in any case, during an interview with Bloomberg in 2023, the company's co-CEO, Ted Sarandos, made this shocking statement: “We have never canceled a hit show.” This may surprise you, but know that when Netflix decides whether or not to cancel a series, the one -this takes into account both the audience and the cost of this content.
“A lot of these shows were well-intentioned, but were aimed at a very small audience with a very big budget. The key is that you need to be able to speak to a small audience on a small budget and a large audience on a big budget. If you do it right, you can do it forever”, explained the co-CEO, who is also the former head of content for the platform.
Netflix in the race for engagement
In other words, Netflix can cancel a series that had some popularity and good feedback, but whose budget was disproportionate to the number of people who watched the content.
And everything suggests that things will continue to move in this direction, in the coming years, with the change in the platform's economic model. As a reminder, Netflix today offers an affordable subscription which is partially financed by advertising. And this offer brings more money to the platform, if users spend more time watching films or series. As a result, subscriber engagement will be more important to Netflix than before.
Otherwise, we also recall that recently, Netflix announced that from 2025, it will no longer declare its number of subscribers. “As we have noted in previous letters, we focus on revenue and operating margin as our primary financial indicators, and on revenue and operating margin as our primary financial indicators. engagement (i.e. time spent) as our best indicator of customer satisfaction. In our early days, when we had little revenue or profit, growth in membership was a strong indicator of our future potential”, we read in a letter addressed to shareholders, at the occasion of the presentation of the results for the first quarter of 2024.
- Netflix canceled a good number of series during of its existence
- But its co-CEO claims that SVOD has never canceled a successful series
- On the other hand, it can cancel a series with a small audience, but a big budget
- Moreover, now that it offers a subscription financed by advertising, SVOD should increasingly focus on engagement (the time spent by users on the platform)
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