Keeping "Friends" On Netflix Canada Was The Worst Decision The Streaming Service Could Have Ever Made - Narcity

Keeping "Friends" On Netflix Canada Was The Worst Decision The Streaming Service Could Have Ever Made

At a time when Netflix needs to make all the right decisions... they just made the worst one.

Earlier this week, Netflix Canada made headlines after it was revealed that they'd be removing the beloved sitcom "Friends" from their roster. As a result, thousands of Netflix users took to Instagram, Twitter and Facebook in a global plea to stop the streaming service from getting rid of the show come 2019. As a result, Netflix caved and promised it would be back for another year. But that isn't necessarily a good thing. 

READ MORE: 25 Christmas Movies To Watch Up Until Christmas On Netflix Canada To Get In The Holiday Spirit

Netflix first got the rights to stream "Friends" back in 2015. At that time, they paid $30 million for the rights to the ten seasons. In order to keep the show this time, Netflix had to hand over a whopping $100 million to keep the rights for only one more year. 

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While it may seem that Netflix is a profitable company that can afford to spend that much on a show, they aren't.

In fact, Netflix has been struggling with growing their revenue as fast as the company is. For example, back in September of 2017, the company reported a $1.855 billion loss as a result of operations costs. In fact, Netflix has been losing money for the past three years

There are several reasons why Netflix struggles so much with generating revenue. For one, since people can share a membership by giving their password to friends and family, that limits the amount of monthly membership money the company can bring in. On top of that, without advertisements, Netflix doesn't have many ways of making money other than their membership fee. 

This can become a problem when you have to buy the rights to shows to get content on your streaming site. It can become an even bigger problem when you spend $100 million on one that hasn't had a new episode in over a decade

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While the move might have satisfied customers for this week, let's be honest. "Friends" is a good show, but it doesn't get the same amount of traction that new releases would receive.

Consider cult favourite, "Stranger Things" - a show that rakes in tons of viewers and cost Netflix $48 million for season two, under half of what they had to pay for "Friends".

Keep in mind that Netflix uses a significant amount of data analytics in order to make their decisions on whether to keep or drop certain shows. Meaning that if they were planning on getting rid of "Friends", it was for good reason.

Public outrage proves that a lot of users like to have the option to watch "Friends" on Netflix. But, it doesn't prove that fans will watch it as much as Netflix needs them to in order to make that $100 million investment worthwhile.

Also considering that Netflix judges a show's success by how much a show generates new membership purchases, it's also worth wondering if enough people buy Netflix memberships to specifically watch "Friends" when the show is readily available on cable. 

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Aside from "Friends" fans overjoyed with the news that their favourite 90's show was safe from the chopping block, there are many other Netflix users who acknowledge that this might not have been the best decision for the streaming service: 

The reality of the matter regardless of whether you want "Friends" on Netflix or not, is that with years of a lack of profitability under their belt, spending $100 million on an older show instead of spending that money on new content was a mistake.

What has helped Netflix get a leg up against other streaming competitors has been their investments in original series and movies. The investment in "Friends" will surely eat into the budget for Netflix originals. So, if anything, this latest move brings the company a step backward. 

*The opinions expressed in this article are the author's own and do not reflect the views of Narcity Media.

 

Source: Variety, Forbes, Empresa Journal, New York Times

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