Netflix now seems to be well into the advertising way of thinking with the new option -- and to an extent, thinking more like a traditional TV network.
What does that mean? To go beyond prime-time TV shows and movies. Think sports. And what's the best-performing franchise here? The NFL, of course.
Netflix's advertising effort will take time to build -- and that's okay. It will be around 10 years from now when the next round of NFL TV contracts gets going.
Still, it won't be an easy get. Other digital-first competitors are already moving fast -- like Amazon Prime Video, which has already secured NFL’s modest “Thursday Night Football” package.
Apple TV+ is also moving in the sports arena, grabbing a Friday night Major League Baseball package. Reports suggest Apple TV+ also has the inside track to secure the big NFL Sunday Ticket package of out of town market games.
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All this advertising focus may make sense, as Reed Hastings, Netflix CEO,, recently said: “It's definitely the end of linear TV over the next five to 10 years.”
Does he mean everything will stop -- including sports? He did not offer any details. Linear TV continues to drive its immediacy from high-profile live sports programming; marketers will pay premium ad rates for that access.
To be sure, legacy TV/media companies have a plan -- with their own still-growing -- but money-losing -- streaming platforms. They won't go quietly. Currently, all simulcast their linear NFL games on their OTT services.
The bottom line right now is that Netflix probably is the only streaming platform to be posting a positive net income. That's a good position to be in. What if Netflix had an earlier plan a few years ago to have an advertising option? Perhaps it could have secured some piece of those NFL deals recently inked.
Even without the NFL, Netflix should be thinking about other sports -- NBA, Major League Baseball, perhaps Nascar. All that would give its new advertising platform some needed heft -- helping to monetize what can be an expensive new operation
Netflix has been tiptoeing into gaming content-- which would target next-generation, young TV-media consumers.
That's amiable. But the ad-supported gaming content there is still a nascent -- and some would say, tricky -- business. Near-term prospects have very limited availability for marketers -- due to sensitivity to minimizing any disruption of game action.
Analysts talk about the dual growth that advertising revenue brings for all TV networks/platforms. But the question is can Netflix hold on long enough to see meaningful results from ad revenue?
There is one key way to accelerate this stuff, and that means really upping their game.
Wayne, judging by the way it seems to be approaching its ad-supported venture---or, maybe, "adventure" is a better word ----Netflix does not appear to be thinking like a traditional TV network. Instead, it seems to think of itself as a digital video platform with "partners" handling ad sales, attained largely via computers not person- to- person dealings. That's fine for search and direct response advertisers and for local small fry marketers---but not necessarily for the big national branding advertisers---who spend well over $50 billion annually on "TV".