Media Companies Make an About-Face on Netflix

'If you can't beat 'em, join 'em'

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Media firms, which have long considered a Netflix a major threat in the war against cord cutting, are singing a different tune—publicly, at least.

CBS Chief Executive Les Moonves, who said last September that his company was “trying to see what Netflix is,” has made a 180 turn on the issue: “Gee, it's great to be in business with them and they are terrific,” he said in an earnings call last week. Meanwhile, Time Warner chief executive Jeff Bewkes called Netflix “a welcome addition” and said last week that he had a “fondness” for the company, whereas he had once compared it to “a small Albanian army unlikely to conquer the world.”

Many executives are praising Netflix in order to adapt to what they believe is an inevitable shift in consumer behaviors, says the Wall Street Journal. Plus, Netflix has managed to garner some favor by showing a willingness to shell out for programming. The company’s recent deals to acquire streaming rights for shows—including Nip/Tuck and Mad Men—is giving basic cable programming a new syndicated home. Still, some media execs fear that the availability of these shows on platforms other than TV will even further encourage customers to ditch their cable subscriptions.

As media companies try to find ways to replace revenue lost as a result of customers’ shift to online viewing, streaming services like Netflix, Hulu, iTunes, and Amazon are pitching themselves as a solution—a way to make a profit off of old content without eating into traditional ad and subscription revenue, says the WSJ. And some of the media companies are taking a bite in hopes of signing digital syndication deals that could produce billions of dollars annually. “The model isn't going to go away,” said one major media exec. “So, if you can't beat 'em, join 'em.”

@adweekemma Emma Bazilian is Adweek's features editor.