Hollywood Still Trying To Kill The Golden Netflix Goose

from the incredible-mistake dept

Netflix has made its share of mistakes lately in dealing with its customers, but the company’s biggest problem may be that Hollywood is so jealous of its success that it’s now seeking to kill off the company’s service by refusing to license movies and TV shows to Netflix. This isn’t a surprise. We’ve seen similar stories over the past year or so, but the fact is that Hollywood is so short-sighted that it’s trying to hold back the tide, and in the process, causing itself more harm. Netflix isn’t “the enemy.” It’s found a way to offer a good service that many people want and use at a price point that makes sense.

Of course, it’s that part that makes Hollywood freak out. They fear the “threat” of new business models that undercut their legacy deals, and that means they want Netflix to boost prices, put even more annoying limitations on use and greatly delay and limit selection—because they stupidly think this will drive more people to the more expensive offerings from the studios themselves. The’re wrong. All this does is drive more people to piracy, while killing off one of the few services that was allowed (if briefly) to effectively compete with “piracy” by offering a better overall service.

The problem for Hollywood doesn’t appear to be piracy. It looks like it’s Hollywood’s own fear of piracy that is leading it to make really short-sighted decisions.

Filed Under: , , ,
Companies: netflix

Rate this comment as insightful
Rate this comment as funny
You have rated this comment as insightful
You have rated this comment as funny
Flag this comment as abusive/trolling/spam
You have flagged this comment
The first word has already been claimed
The last word has already been claimed
Insightful Lightbulb icon Funny Laughing icon Abusive/trolling/spam Flag icon Insightful badge Lightbulb icon Funny badge Laughing icon Comments icon

Comments on “Hollywood Still Trying To Kill The Golden Netflix Goose”

Subscribe: RSS Leave a comment
95 Comments
Mesonoxian Eve (profile) says:

I just recently canceled my Netflix subscription because of the fact it doesn’t seem to be nothing more than a Hulu clone anymore. I signed up for the streaming service, but it’s nothing but television shows, not movies.

But I’d like to point out something: “All this does is drive more people to piracy…”
This isn’t true for me. Unlike most, I don’t need Hollywood. It needs me. I’ve done without and it’s their fault.

If Hollywood wants my money, they sure have a screwed up way of trying to get it. It truly is a shame they expect me to buy plastic disks, and in the internet age, is something I’m not doing ever again.

I’m sick of storing this crap. Sick of buying a title only to watch it a few times and then never watch it again.

Entertainment is disposable, just as the income is to view it.

It’s a shame this is a multi-billion dollar industry, because it’s that greed of keeping it this way that’s making it difficult for everyone, especially those “2 million” who rely on my money to make their salary.

It’s just a shame it’s the other way around to the point Hollywood knows people need it more, because it’s true. People whine and complain but they still don’t go without, never realizing if they took a different action, they’d win the war.

gorehound (profile) says:

Time For MAFIAA To Die

As Noted in News Stories are these:
1.Every time New Tech comes round the Big Greedsters do all they can to shut it down.Player Pianos, Records, Radio, Talking Film, Reel Tape Recording, Cassettes, VHS, DAT,Online, ETC.
2.These Big Studios are Dinosaurs that need to be the ones to go.Time for New Ways of Business & TV.Make your own shows of Quality without MAFIAA and sell your Show to Netflix, ETC instead of MAFIAA TV Shows.There can be really good INDIE Shows
3.Netflix & Other Online Should produce TV INDIE Shows Minus the Cooperation of MAFIAA
4.No need to even use high priced MAFIAA Stars when some of the best talent is just itching to get the chance to do something with their lives.
5.It is quite possible at this point to live in a World where MAFIAA goes down the Drain.
6.Why support an Industry that wants to Control the Content of the Internet and actively works to sabotage our Privacy and our Rights as pertaining to the Internet.I refuse to go to a Theater or to Buy any new MAFIAA Material.I buy only Used Physical Media and MAFIAA does not get a red cent out of me.They want to Censor me so I have Censored them from my Wallet.

Jeremy Lyman (profile) says:

Re:

My thoughts exactly on the “All this does is drive more people to piracy” bit; there are other effects. These shenanigans just make me want less and less to do with anything Hollywood produces. I’ve pretty much stopped going to movies at the theater, and I’ve had my Netflix account on hold for about 8 months. Even if there’s a movie I’m genuinely interested in seeing there’s this mental hurdle I have to get over, and generally forget about the flick by the time the release windows have done their magic. I even do research on artists before buying music on Amazon to make sure they’re not tangled up with labels I despise.

Consumers need to realize the entertainment industry is optional and the conglomerates don’t have us over a barrel like the gas, telcom and banking industries do.

Anonymous Coward says:

the entertainment industries sole answer to any company that has a better business model than it, has better services than it or better products than it has always been and will always be to do it’s damnedest to kill that business off. it will never try to compete, it will never try to be better, it will never try to share, unless, of course, other companies will pay the bills but allow the industries to keep all the profits!

John Doe says:

DVDs are for me

I dropped Netflix streaming and kept the DVD service. I supplement my subscription with RedBox. DVD players are $30 now and I get higher quality display with DVDs over streaming. So I could care less if Hollywood kills of streaming. Yea, I would like to use it if it was as cheap as rental DVDs, but it isn’t so I make do.

One thing I have started doing is renting DVDs and copying them to my laptop so I can view them when on the road where rentals aren’t practical. So no need to stream when I can watch even w/o a WiFi/cellular connection. I do delete the movies after I have watched them so I am effectively time and place shifting my rentals. I also sleep like a baby.

Anonymous Coward says:

VIACOM Dios! (For the non-spanish speaking people try Google Translate: “vai con dios” and click on the “listen” icon inside the spanish box text and you hear it).

Vai con dios = goodspeed. Used in this context to mean “good riddance”.

Techdirt teaching you about other cultures.

Of course I don’t want Netflix to fail, but if they do, this means the industry also fails a little with it and that in my book is a good thing, nobody should do business with those creeps they are not good partners, monopolies never are.

PaulT (profile) says:

Re:

How much do they get for the average TV viewing, or a DVD borrowed from a friend, airline screening or library rental? Is it more? If not, why aren’t they trying to kill off those viewing methods as well?

The only way Hollywood gets less than alternative methods is if you assume that Netflix completely replaces theatres and DVD sales, which is a very stupid assumption to make. You’re a moron if you think that killing off Netflix will suddenly transfer into more revenue.

Anonymous Coward says:

Re:

Here is the thing that I mostly don’t understand, Netflix mostly competes and cannibalizes cable traffic, which pays per client $0.005, Netflix pays more than that from what I have seen(I could be wrong though) so why are studios not wanting Netflix to succeed since it pays more to them than other competing offerings?

<wild assumptions>
Probably because some studios are the owners of cable and they see that as a threat to their own services that people are starting to move away from, meaning even though cable pays less money officially, the real money probably is transferred on the background through other less than reputable means to some other people who control it.
</wild assumptions>

Jeremy Lyman (profile) says:

In the UK...

Paul, one of the heavy responsibilities of being a gatekeeper is appointing oneself a custodian of regional identity. Careful thought must be invested when allowing creativity to travel between well defined marketing target groups. We must ensure that, like an invasive species, the alien content does not take root in the very culture of a civilized population, forever changing the landscape of people’s hearts and minds.

Can you imagine a world where SpongeBob Square Pants was irresponsibly allowed to roam freely? Think of the pandemonium that would ensue. Actually; stop. Don’t think about it. Thinking about it would be as bad as it actually happening. Maybe worse. Here, have a biscuit. And some tea. We’ll make sure that never happens.

Bob V (profile) says:

Re:

I got rid of the cable boxes about 6 months ago expecting the kids to be upset, not even a wimper about missing jersey shore. The kids (2 of em) have been to 3 movies in the last year and its been since Star Trek (the new one) was released that I went to a movie.

As loud as they are screaming about piracy and lost revenue guess what thats really all i know about the entertainment industry. If a tree falls in the woods and no one is there to hear it fall…

A Guy (profile) says:

Re:

No, that’s a myth that business schools have been perpetuating.

Businesses always do the thing that makes them feel safe and profitable. Once they no longer feel safe and profitable, they take all their resources and use them to cry as loudly as possible to every politician and anyone else they can find until they get enough regulation to feel safe and profitable again.

Remember, they don’t have to actually be more profitable, they just have to feel more profitable.

Anyone that makes a businesses feel less profitable is obviously a scary pirate, and therefore makes them feel less secure.

Math, technology, and evolving business models are for nerds.

Anonymous Coward says:

Quote:

Hollywood accounting is not limited to movies. An example is the Warner Bros. television series Babylon 5 created by J. Michael Straczynski. Straczynski, who wrote 90% of the episodes in addition to producing the show, would receive a generous cut of profits if not for Hollywood accounting.[citation needed] The series, which was profitable in each of its five seasons from 1993?1998, has garnered more than US$1 billion for Warner Bros., most recently US$500 million in DVD sales alone. But in the last profit statement given to Straczynski, Warner Bros. claimed the property was $80 million in debt. “Basically”, says Straczynski, “by the terms of my contract, if a set on a WB movie burns down in Botswana, they can charge it against B5’s profits.”

Source: Wikipedia

How is Hollywood to charge Netflix for fires in Botswana?

Maybe what Hollywood is really afraid of, is the end of creative accounting, since I doubt those other players would all be in on those type of schemes to funnel money in that way to only a few stake holders, and if Netflix start to show how the real numbers appear to others this could expose their practices to a greater scrutiny and that is a threat.

Anonymous Coward says:

Quote:

They can create fictions, where instead of reporting all of the revenues from the distribution of home video or DVDs, they pay a royalty from one of their entities to another entity. Thus the participant only participates in the royalty, not the full pot of revenues.

In the studios that have multiple distribution channels and production channels, they can deal with each other and manipulate the license fees among their affiliated entities so that the participant receives less revenue than might otherwise be the fair market value.

Source: Hollywood accounting

Netflix is a threat to the business of stealing from creators and funeling the money to a few people really, if they don’t control it and can’t make Netflix do the absurd charges they use in their ficticious fronts than their sham is revealed and can be used by others in a court of law to show how bad they are misleading others(i.e. actors, staff, writers and everybody else not in the inner circle) who sign contracts with them.

PaulT (profile) says:

In the UK...

I’m a rebel who likes roaming around under the very noses of gatekeepers. I flit freely between English and non-English speaking countries on a whim. I buy most of my content outside of my country of residence. Hell, I spent several weeks physically in the US in the last year and accessed Netflix, Hulu and Pandora for free! Imagine the revenue wasted on showing me adverts for products I will never use and services I will never pay for!

Clearly I should be punished, as it’s the likes of me who are stopping them from offering these services to whoever wants them. They can’t possibly offer services until I force myself to fit neatly into whichever box is easiest for them to control. For this I am truly sorry 🙂

Anonymous Coward says:

Re:

Netflix can’t be used to create fictitious accounting spendings though and could give those affected by those practices to have a real world example to use in court to calculate values for damages so they must make Netflix operate under the same rules they use on their own losing money(on paper) business that continue to be operational even though they are always in the red otherwise they sham is exposed.

Anonymous Coward says:

I’d love to see Wal-Mart decide that the industry owes them more per sale and refuse to sell till demands are met. They defiantly have the influence to hurt a product very fast. The only people who don’t use Wal-Mart are the rich.

Bad thing for them since the majority of us are not rich and rely on Wal-Mart for cheap shit made in China. If it breaks who cares take it back you can get a refund for pretty much anything! Well except prepaid phones and dvds even if you decided it was trash you won’t be refunded. Don’t believe me go try it for yourself.

I won’t even lie when I was younger and broke as hell I relied on Wal-Mart returns as my rental service for tools and shit.

This is America and if something sucks you get your money back! Unless it’s from Mel Gibson, South Park proved he is fucking scary O_O and likes to smear shit on stuff! Anyone else I will demand my money back but I draw the line at Mel Gibson.

E. Zachary Knight (profile) says:

Re:

Yeah. $2.2 billion a year is nothing to sneeze at. OI would suspect that at least half of that is going out in licensing deals to various studios and networks. Probably more than half.

The problem seems to be on the side of the studios and networks which are collectively asking for way more than Netflix earns in revenue. Kind of like how the music labels tried to kill internet radio.

Anonymous Coward says:

As a strong advocate of intellectual property rights, I have to agree that the studios should be doing everything possible to support lawful distribution models. The proliferation of media platforms and accessibility to them has increased the size of the market and corresponding demand enormously. They should be as happy to see their success as they are for the success of theaters and (former) distributors of DVD’s. The battle against infringement cannot be won by focusing on preventative measures at the exclusion creating more robust distribution. I have to wonder if there isn’t a studio-driven streaming platform in the works that is influencing the relationship with Netflix.

Anonymous Coward says:

Quote:

Confused? Imagine you’re running a lemonade stand with your buddy Steve. Your mom says you have to share half your profits with your sister. But you don’t wanna! So you pretend your buddy Steve is actually a corporation — call him Steve, Inc — charging you rent for the stand, the spoon, etc. “Dang, mom, I don’t have any profits, I had to pay it all to Steve, Inc!” you say when you come home. But the money isn’t gone. It’s as good as yours — in your best friend’s pocket.

Source: The Atlantic: How Hollywood Accounting Can Make a $450 Million Movie ‘Unprofitable’

In that case Netlfix selling lemonade would expose their accounting practices and reduce their overall money making schemes that is probably why they want so bad Netflix to pay more and more, studios don’t care about the profitability of Netflix they care about what they can put on the spreadsheet and Netflix spreadsheet they can’t write it for them and that appears to be the real problem.

Studios want to kill the Netflix’s of the world so they continue to rob others from the money they worked and were not fully paid for it, not their fair share anyways.

The brilliant part is that they got the dumb writers, actors and everybody who works for them to defend them against Netflix LoL

This may even be what happens in the music world and with so many stoned performers they get shafted and still defend that system LoL

E. Zachary Knight (profile) says:

DVDs are for me

I went the opposite route. I ditched the DVD portion and kept the streaming. Why?

1) Because I have kids and Netflix streaming has a whole lot of really great kids shows and movies that I am happy for them to watch.

2) There are a lot of television shows available for it that my Wife and I enjoy watching that we can’t get otherwise. We don’t always know which show we will feel like watching each night and would hate to be locked in to a particular show via DVD if we were not in the mood.

3) The convenience of Redbox made the need for the DVD side pointless. At 1 DVD at a timeI would have to get 8 or more DVDs a month to be cheaper than Redbox, but we only watched 1 a week at most. So the switch was a net gain for my family.

jsf (profile) says:

Worse Than Piracy

These attitudes do something even worse than drive people to piracy. It drives people to other providers and other types of entertainment. Such that their potential customers will soon have no interest in what they produce.

New players using things like YouTube and TwitchTV are going to start eating away at their bottom line, unless they make their content just as easy to obtain.

Anonymous Coward says:

Re:

This is sadly true. While I detest wal-mart with a passion, most everyone in my town relies on it for just about everything, because it’s just about all we’ve got.

However, wal-mart is a corporation. They won’t risk losing the profits from DVD sales to protect the public from the entertainment industry, even if it would make them heros in the eyes of everyone who is fed up with Hollywoods bullshit.

PaulT (profile) says:

Re:

…is Fear Itself.

Hey, wouldn’t that be the NBC TV series followup to Masters Of Horror for which I’m yet to see a legal DVD release outside of North America and and thus blocked from viewing despite owning box sets of the former series? That I could easily view legally if they weren’t region blocked or if they were available on a local Netflix account or equivalent, but which I’d need to pirate to watch at all under the current regime? Which I’d happily pay money for if there weren’t artificial restrictions preventing me from doing so?

“It looks like it’s Hollywood’s own fear of piracy that is leading it to make really short-sighted decisions.”

Bears repeating.

jupiterkansas (profile) says:

Never Understood

Um…. they have already started doing this.

“So far that plan for content has led to five show commitments in the U.S., including Lillehammer, starring Steve Van Zandt, which has already premiered; and the upcoming House of Cards, directed by David Fincher and starring Kevin Spacey; and a new season of the cult series Arrested Development. They also have coming Hemlock Grove from horror director Eli Roth, which Sarandos described as Vampire Diaries meets True Blood.”

http://www.hollywoodreporter.com/news/netflix-ted-sarandos-original-content-309275

Anonymous Coward says:

Never Understood

“Why doesn’t Netflix just say to Hollywood “screw you guys, I’ll make my own moon amusement park; with blackjack, and hookers.” or something to that effect.”

Because Netflix isn’t Bender and only Bender can get away with such talk. 🙂

Isn’t Netflix going to start producing their own stuff soon? I know they’re bringing back Arrested Development. Or at least one season, before the movie gets going.

I think Netflix should bring back shows that were kicked to the curb. Like Arrested Development. Firefly. Etc. Heck, those two alone would be enough to win me over and get me to subscribe.

Dannie blaze (profile) says:

I have a question – how would Hollywood react if the tech was available to beam movies and TV directly into your brain? Would we be guilty of ‘theft’ for ‘storing’ that data inside our heads?

Would the Government star seizing people’s grey matter because of alleged infringement?

Would Hollywood demand you pay a licence fee every time you remembered a cool moment in a film?

Let the reducto ad absurdum begin.

Ed C. says:

In the UK...

[The above comment may contain sarcastic material, and, as such, may not be suitable for all IQs. Any failure to detect the presence of sarcastic material will require the recalibration or replacement of any requisite sarcasm detection device, or a exculpatory colon cleaning for those who do not possess such device.

Safety advisory of the Sarcasm Advisory Council]

ltlw0lf (profile) says:

Re:

How is Hollywood to charge Netflix for fires in Botswana?

What is sad, and clearly should be illegal, is that WB charges everyone for when a WB movie burns down in Botswana. Where in the world of business can a company charge for the same loss many different times? When I worked for a company that sold electronic equipment and something was damaged or destroyed — we could only charge the insurance company or take it off of our taxes as a loss once. Where can I get a job where I can charge everyone for the same loss many times? I want that job.

ltlw0lf (profile) says:

Re:

Id gladly pay $20-$30 a month for streaming netflix if everything went to it.

I’m already paying $20-30 a month for Netflix (both streaming and DVD) and I’m not going anywhere. Netflix is still the best deal in town, and with all the new stuff they’ve been adding, including all the TED talks (which you can get on the TED website, but I like having them all in one place, with descriptions and can play them in order,) I don’t think I’ll run out of things to watch any time soon.

Jesse Townley (profile) says:

Reminds me of the Spotify uproar

Friends of mine have pulled their catalogs off of Spotify because the streaming income is so paltry.

I take the opposite tack- I want our catalog every legal outlet possible, regardless of the income stream. It’d be a betrayal of our due diligence to distribute our artists’ work.

Of course, we’re not 20th Century Fox.

I’m a Netflix customer but I’ve also kept my local brick & mortar video rental membership for just this reason. There are always really puzzling gaps in Netflix’ offerings, and movies have “Watch By” dates because their licensing is expiring.

(Also, the selection really sucks once you get below the surface of various cult & specialized genres- I end up buying a fair amount of PAL & non-Region-1 DVDs from overseas because it’s literally impossible to find the DVDs with extras etc, even via torrent, through domestic means)

It’s astonishing how stupid really educated, experienced suits can be.

khory (profile) says:

Re:

Maybe there is, maybe not. But how long are they going to take to get it going? They are already a number of years late.

The thing is, Netflix has such a huge distribution system that I don’t see how they wouldn’t want to take advantage of that. It is on just about every device you can think of now. Why not just license your content and collect your money? And provide a popular alternative to piracy at the same time? Seems like a no brainer!

Hollywood is determined to ice skate uphill every chance they get….

Vincent Clement (profile) says:

Re:

Netflix can most definitely be used in Hollywood Accounting.

Hollywood Inc creates a new company called Hollywood Licensing. Hollywood Licensing charges Hollywood Inc a “fee” for negotiating and collecting those license fees. Hollywood Inc add that “fee” to their Hollywood Accounting Pro Forma as an expense, let’s call it “License Fee Recovery”.

So now not only does Hollywood Inc get all the license revenue from it’s wholly-owned subsidiary Hollywood Licensing, it gets additional revenue in the form of “License Fee Recovery”. Win – win for Hollywood.

Vincent Clement (profile) says:

Re:

What is there to cook? Hollywood wants a system that they can control. We are beyond that. Just give us what we want at a reasonable price with no limitations or restrictions.

DVD protection hasn’t stopped a single person from making a copy of a DVD, yet Hollywood keeps insisting on including DVD protection, even if it means that the legally-purchased DVD cannot be watched on relatively modern devices.

When one of the discs of Grey’s Anatomy that I purchased for my wife would not work in a portable DVD player, I did what everyone else does: download a torrent with the copy protection removed. That’s why torrent is popular: because it works.

DC (profile) says:

Re:

They are trying to kill off currently effective and profitable distribution models. Hence they are not doing everything possible to support lawful distribution models, yet you do not condemn them.

Any distribution model driven by, and most especially implemented by, the studios will fail. It will be more expensive, more restrictive, and will not be widely adopted. If they succeed in killing netflix, more people go download unauthorized files.

As a strong advocate of IP rights, why don’t you choose a consistent alias and claim the IP you post here?

PaulT (profile) says:

Reminds me of the Spotify uproar

Anybody who pulls their catalogue from Spotify is a fool. Personally, I use the service to listen to all music, including that I already own. If your music isn’t there for me to discover, I won’t discover it. If I already own your album, you won’t get my revenue from listening to it, I’ll listen to another artist who will get my money…

Add Your Comment

Your email address will not be published.

Have a Techdirt Account? Sign in now. Want one? Register here

Comment Options:

Make this the or (get credits or sign in to see balance) what's this?

What's this?

Techdirt community members with Techdirt Credits can spotlight a comment as either the "First Word" or "Last Word" on a particular comment thread. Credits can be purchased at the Techdirt Insider Shop »

Follow Techdirt

Techdirt Daily Newsletter

Techdirt Deals
Techdirt Insider Discord
The latest chatter on the Techdirt Insider Discord channel...
Loading...