Programmers Are Frustrated by a Lack of Netflix Metrics

Dearth of viewership data ‘runs counter’ to industry standards

When Breaking Bad scored three Emmy wins last fall, its showrunner, Vince Gilligan, credited Netflix for his show’s longevity and for heightening its popularity. Similarly, program execs in general have been thrilled with how streaming video services have made up for lost DVD revenue.

But a little bloom is off the rose. Frustration with Netflix has set in as programmers renegotiate contract renewals (to the tune of more than $7 billion, according to some estimates).

“The biggest concerns are about getting sufficient metrics about how their product is being consumed,” said Bruce Lazarus, CEO of Media Audits International (MAI), which helps programmers validate the subscriber information they receive from distribution platforms. “When you want to sell your content to the platforms, what’s the proper pricing model?”

“We get a little information about which of our products are being watched on Netflix, but we get no data about who exactly is watching our shows,” noted John Kampfe, CFO of Turner Broadcasting System.

Netflix declined to speak with Adweek for this story.

“Oftentimes data is limited to stream starts and/or unique users, and neither provide meaningful insight into the value of a programmer’s content,” said Richard Taub, svp of broadcast and digital services at MAI. There’s no standard definition of stream starts; it could mean someone merely hit “play” and watched for either two seconds or two hours.

The lack of data “runs counter to just about everything else in the industry,” added Larry Gerbrandt, principal of the consultancy Media Valuation Partners. “Netflix could say, ‘We’ll renew, but now your content’s older, and we want to pay you less.’ But if the programmers had viewership data that would show that usage is going up, or [is] at least flat, that would counter that argument.”

“The places we have to go to find [usage data for Netflix] are either private research companies that field panels, which you pay a lot of money to maintain, or we can do surveys. But surveys are notoriously unreliable,” said one network executive. That person notes that some Netflix rivals, like Hulu (which is owned by programmers and therefore more transparent) and iTunes (which is a pay-to-play model) aren’t as problematic.

The problem could eventually resolve itself. “Over the next five years I expect that advertising will be part of SVOD [subscription video on demand], and therefore we will have measurement ratings that will be visible to both sides, Netflix and the programmers,” said Laura Martin, a senior analyst of entertainment, cable and media at Needham & Co. That’s likely to happen at Netflix when subscriber growth hits a wall, Gerbrandt added.

In the meantime, Netflix isn’t budging on the metrics front. “We talk to them about [the missing metrics] every time we talk about product,” said Kampfe. “It usually comes down to, ‘Are we willing to sell them the product for a particular price without getting the data?’ And right now that seems to be the case.”

Janet Stilson is a freelance writer for Adweek.