Sunday, March 3, 2013

Netflix's Upward Mobility

The "It" event of the moment appears to be the Netflix original series, "House of Cards." The concept itself is novel and one that could be a forerunner of more to come; Netflix has made all 13 episodes of the series available for streaming as part of its online service.

The repercussions are immense and further remove us from what used to be our normal patterns of television viewership. We've become a nation of mobile consumers, no longer wanting to be tied down to our couches to watch our favorite shows each night at a certain time. We want it 24/7, a constant flow of information, dynamically connected in time and space to wherever we happen to be and whenever we want to decompress and unwind in front of whatever screen we have available to us. We are all "in the moment."

The network executives have got to be a bit undone by the viewership changes. According to an A.C. Nielsen study, about 31% of the cherished 18-49-year-old audience watch less than two hours of TV each day. This younger group of viewers is 1.5 times more likely than the older, established audience to be considered "light TV viewers" who would rather spend their time on a portable device that glued to a plasma screen in the living room.

Networks have responded in several ways: TV shows are geared to an older demographic, whether crime dramas such as "NCIS" or comedies such as "Modern Family," both of which feature AARP-eligible leads (Mark Harmon and Ed O'Neill). And that's not a bad thing necessarily: More than 40 million Americans are age 60 and older. Hence the continued fascination with all things Betty White and the well-past-its-expiration-date "60 Minutes" and even "The Simpsons."

A few of the savvy networks also are looking squarely at this younger audience. Both NBC and ABC, to name two, have sharp interactive apps that allow the downloading of shows anytime, anywhere. On-demand cable viewing also is growing in popularity.

Netflix is an interesting case for more to come. The online movie service took a lot of heat last year -- and saw its earnings suffer commensurately -- when it attempted to break its streaming service and movies-by-mail service into two and charge higher prices. But now, the company is reversing course via originally produced entertainment that it purchases.

"House of Cards" is one attempt, as was its "Lilyhammer" series last year with former "Sopranos" mobster (and Springsteen guitarist) Steven Van Zandt. We'll get more into "House of Cards" in a future blog, but Netflix also plans to resuscitate "Arrested Development,"albeit for one season only.

What's in it for Netflix? There already is more interest in its streaming service, certainly a cost-friendlier device to the company that shipping out movies in red paper covers. And an update in its brand: Netflix can shout that it no longer just offers indie and less-than-blockbuster fare on its streaming service but now can compete with the likes of HBO and Showtime (plus the cable stations such as TNT and AMC) in quality original content.

Lilyhammer, Netflix's first original series, debuted in Feb. 2012
There is a hard cost to Netflix in acquiring these properties, like the Kevin Spacey political melodrama. But if it meets the needs of our mobile audience demanding more and better content to watch anytime and anywhere, it is a risk that could also lead to more cold sweats from network TV execs.

No comments:

Post a Comment