Netflix Mocks NBC's Obsession With TV Ratings Systems Built For A Bygone Era

from the the-wailing-of-the-dinosaurs dept

Last week, NBC executive Alan Wurtzel boldly claimed that Netflix and YouTube weren't threats to traditional cable. His only evidence? Data purchased from a company named Symphony that guesstimates Netflix's closely guarded viewership numbers. That data actually showed Netflix's viewership numbers for its original series are impressive, but found that viewership wanes a little once users get done binge watching. That's it. The data didn't really support Wurtzel's claim that Netflix doesn't pose a threat to traditional cable, NBC was just boasting that it had figured out Netflix's viewership tallies.

Symphony was born out of the well-documented failures by Nielsen to track consumer viewing on new platforms, and not only tracks every viewing habit of some 15,000 Netflix customers, but also uses GPS data to track where these customers are viewing the content. It's a welcome improvement for an industry that spent the last decade paying for data that only told it what it wanted to hear: namely that cord cutting and Internet video weren't a serious threat.

And while trying to understand your competitors makes sense, it's hysterical how Netflix's hidden viewership numbers seem to drive traditional broadcasters absolutely crazy. You'll recall that CBS threw a similar hissy fit last year, clearly upset that Netflix doesn't have to adhere to traditional ratings metrics because it's not an ad-supported legacy service.

Netflix chief content officer Ted Sarandos also spoke at the same Television Critics Association meeting, and first highlighted how it's telling that NBC took its allotted time at the meeting to obsess over Netflix:

"Given what is really remarkably inaccurate data, I hope they didn't spend any money on it," he said of the numbers. "There's a couple mysteries at play for me. Why would NBC use their lunch slot to talk about our ratings? Maybe because it's more fun than talking about NBC ratings. … The methodology doesn't reflect any sense of reality we keep track of."

But then Sarandos went on to make what's probably the biggest point (and one CBS and NBC clearly don't understand): the existing ratings measurement system doesn't matter when you're not reliant on traditional advertising.

"I can't even tell you how many 18-49 users we have … we don't track them," he said. "Those sample sets don't give you a lot of information when people are watching thousands of shows [on Netflix] around the world. Somewhere in the world, every second of every day, someone is pressing start on a Netflix original. … There is not an apples to apples comparison to Netflix watching and any Nielsen rating."

Sarandos noted that the specific numbers — Wurtzel had 4.8 million adults 18-49 watching Jessica Jones, followed by Master of None (3.9 million adults 18-49) and Narcos (3.2 million adults 18-49) — wouldn't even be relevant to his business if they were true. "The ratings themselves have no specific impact on the business," he added. "If we were spending a lot of money on shows people weren't watching, they will quit. People are finding value in how we're spending our content dollars … if they're watching today, tomorrow or seven days from now."

As for NBC's claim that binge watchers always return to watching TV in the "way god intended," Netflix noted in its quarterly letter to shareholders (pdf) that "our investors are not as sure of God's intentions for TV, and instead think that Internet TV is a fundamentally better entertainment experience that will gain share for many years." Obviously the histrionics by broadcast executives surrounding Netflix obfuscating its viewership numbers originate in jealousy; jealously that Netflix gets to operate under a new paradigm where traditional ratings are less important, while legacy sector executives have to stare at charts like this one:

The collapse of broadcast TV ratings. How close to zero before we stop talking about "broadcast", "TV" & "ratings"? pic.twitter.com/4IWnkNAe1J

— Chris Anderson (@chr1sa) January 18, 2016

And while it's great that the traditional cable and broadcast industry is finally cooking up viewer measurement systems that challenge its long-held delusions about cable's infallibility, the petty sniping at Netflix really isn't all that flattering and isn't going to help them compete anytime soon.

Filed Under: streaming, tv ratings
Companies: nbc, netflix, symphony