- Share this article on Facebook
- Share this article on Twitter
- Share this article on Email
- Show additional share options
- Share this article on Print
- Share this article on Comment
- Share this article on Whatsapp
- Share this article on Linkedin
- Share this article on Reddit
- Share this article on Pinit
- Share this article on Tumblr
This story first appeared in the May 9 issue of The Hollywood Reporter magazine.
Seated among top television showrunners at a Hollywood Reporter roundtable in late March, Orange Is the New Black‘s Jenji Kohan had much to gloat about. Her Netflix prison dramedy has garnered sterling reviews and Emmy buzz in advance of its season-two debut June 6, and without the pressure of ratings, she is free to take the series in any (often R-rated) direction she desires. It would seem a dream scenario if not for one pesky side effect: A lack of available viewership metrics “makes it hard to negotiate later,” she says. “Because it’s like, ‘I’m a hit — I think.’ ”
Kohan’s concern is shared by many who work in the increasingly robust digital arena, and it illustrates the growing pains that often come with emerging platforms. Actors and top producers in TV typically renegotiate contracts to provide big pay bumps when their shows become hits, but with Amazon,Hulu, Xbox and even Yahoo pursuing Orange Is the New Black-style programming, their refusal to release traditional viewership data throws a wrench into those talks. As such, studios and talent reps are forced to rethink their approach to dealmaking. “In a typical network renegotiation, you use critical reviews, awards, ratings and ad revenue to support your argument,” says attorney David Fox, who has handled renegotiations for talent including Two and a Half Men‘s Jon Cryer. “Some of those went out the window with HBO. Now you’ve got Netflix and other streaming channels, and you’ve got to find a new metric — that’s what everyone is looking for right now.”
PHOTOS: From ‘Arrested Development’ to ‘House of Cards,’ Exclusive Portraits of Netflix’s Stars
Adds a studio executive who has dealings with streaming players and traditional networks: “One of the reasons you want to know how you’re doing is so that you can do a back-of-the-envelope assessment of how much an ad-supported network is making off of your show. It’s like looking at the Kelley Blue Book: You know how much you can negotiate because you know what the dealer paid for the car.”
In the case of Orange, Kohan and her cast have been told unofficially that the series is Netflix’s “biggest hit,” according to multiple sources. But chief content officer Ted Sarandos and other execs will not elaborate. (They declined comment for this story.) The result, says one rep with an actor on the Lionsgate-produced show: “It is going to be a nightmare to get money from anyone. The show is a huge hit but hard to get paid for without numbers.” (Orange is a shoo-in for a third season, though the cast has not begun to renegotiate.)
Still, there are other compelling data points, according to the dozen or so interviewed for this story, particularly for a service that behaves like a premium cable network because it does not rely on ad revenue. For Orange and House of Cards, for instance, critical attention and cultural buzz carry considerable weight. So rather than come to the table with a collection of Nielsen metrics, a talent rep could present press clippings, positive reviews, awards and other pop-culture references (think Saturday Night Live sketches or prison-jumpsuit Halloween costumes).
STORY: Chelsea Handler in Talks With Netflix for New Show
“The truth is the amount of buzz is what’s going to drive subscriptions, and that’s what they care about,” says another studio executive, adding that the strategy is not dissimilar from that used on behalf of big-buzz, modest-audience HBO series like Girls, the cast of which has renegotiated their deals. Adds attorney Jon Moonves, who has handled renegotiations for shows including Everybody Loves Raymond, “Having the numbers would be helpful, but that’s not the criteria by which they’re primarily making their decisions.”
But an absence of viewer data could be more problematic for Netflix’s Hemlock Grove, which has neither buzz nor positive reviews in its favor. The case to be made would be one of reach, but while Netflix CEO Reed Hastings said in April 2013 that the horror drama is “getting viewed by even more subscribers in its first couple of days” than House of Cards, reps for its stars lack specific data points on which to argue. Moonves suggests there are other telltale signs, including the strength of an outlet’s marketing push.
When making the subscriber argument, it’s difficult to prove causality. But spikes can be attributed, at least in part, to a series airing — and in the case of streaming services, it’s one of precious few numbers being provided. (“I don’t believe in ratings per se,” echoes Xbox Entertainment Studios’ Nancy Tellem.) Multiple sources say Kevin Spacey‘s recent renegotiation on House of Cards relied on data showing subscribers grew from 27.1 million to 33.4 million in 2013. The show also had the advantage of putting Netflix on the map as a destination for original series.
With others including Amazon, which launched Alpha House as part of its first batch of originals in April 2013, dealmakers are sorting through appropriate metrics. Says Fox, “We have to figure out how to adjust the math in order to calculate the value of these shows to the streaming channels.”
Sign up for THR news straight to your inbox every day