How advertising fundamentally changed the equation
Mentioned in this article: Netflix, NFL, Peacock and more.
“We’re not anti-sports, we’re just pro-profit”, said Ted Sarandos at the UBS TMT conference just two years ago, explaining Netflix did not see a path to profit in “renting big-league sports”. While caveating with “never say never”, he reinforced what many in the audience already believed: the economics of major sports are traditionally built around Pay TV and don’t make sense for streaming.
Or do they?
Netflix execs must have high-fived each other on Christmas night, after their NFL double-header achieved three goals: strong global viewership numbers, a great viewer experience, and the rollout of a new customer expectation: going forward, live sports on Netflix will carry ads, even for ad-free subscribers.
Netflix’s evolved thinking about sports makes more sense when you understand their other major shift: embracing advertising. When Netflix started the great transition to streaming, being ad-free...