Netflix, Roku, NBCU Execs Discuss Streaming, Ad Partnerships, Controversial Content at Cannes Lions Festival
The Annual Cannes Lions International Festival of Creativity is taking place this week in France, and multiple leading figures in the entertainment industry have been appearing on various panels, many discussing the future of streaming both within their companies and across the landscape at large. The event is a hub for TV and movie advertising execs as studios build partnerships for the coming year. Since Netflix had never had a stake in advertising before, 2022 marks the first time that the streaming giant has participated in the event.
Ted Sarandos, the streamer’s co-CEO and a longtime top content executive, is being honored at the event as the Entertainment Person of the Year, but that didn’t spare him a tough on-stage interview with veteran tech journalist Kara Swisher.
According to The Hollywood Reporter, Sarandos confirmed earlier reports that Netflix is in talks with multiple ad providers about working together on the company’s new ad-supported tier. Sarandos also went fairly in-depth on the streaming giant’s plans for how the tier will work.
“We’ve left a big customer segment off the table, which is people who say: ‘Hey, Netflix is too expensive for me and I don’t mind advertising,” he said. “We adding an ad tier; we’re not adding ads to Netflix as you know it today. We’re adding an ad tier for folks who say, ‘Hey, I want a lower price and I’ll watch ads.’”
While Sarandos was asked if Netflix’s recent stock dive could lead to a takeover of the company by a rival, he answered that it “is always a reality, so we have to be wide-eyed about that,” but added that he thinks the company can return to growth without such a bold move.
Sarandos also defended the streamer’s controversial stand-up specials by comedians Dave Chappelle and Ricky Gervais, stating that “that’s the beauty of on-demand: you can turn it off. The reason comedy is hard is we don’t all laugh at the same thing.”
However, the exec did say that the company “should have been more empathetic” to some employees who objected to some of that content.
Roku’s CEO Anthony Wood also appeared at the conference and discussed the future of content and advertising from a much different perspective than Sarandos and Netflix.
“All television is going to be streamed,” Wood said, per Advanced Television. “That means all TV advertising is going to be streamed … Streaming is a very efficient way to spend ad dollars.”
Streaming ad sales are at the heart Roku’s business model, which is why they are an attractive partner for Netflix. While Sarandos seemingly dismissed the idea of Netflix outright purchasing Roku — even though Roku began as a Netflix project nearly a decade and a half ago — Roku’s experience and existing infrastructure would seem like an obvious way for Netflix to quickly and relatively painlessly get into the advertising space.
A side benefit of this type of partnership could be that it would likely prevent an upcoming carriage dispute between the companies.
On another panel at Cannes, the CEO of NBCUniversal Jeff Shell discussed recent shifts in TV-watching habits and how his multi-platform company has responded.
“Viewership is shifting from linear to nonlinear,” he said per Advanced Television. “Streaming is a medium, so there are lots of different ways for people to watch TV, so we’ve set up our company to be basically agnostic.”
This approach has led many to be confused about NBCU’s strategy around the rollout of its multi-tiered streaming service Peacock. However, Shell and fellow Comcast execs don’t see Peacock as a traditional streamer, they also see it as a cable inducement, a platform, and potentially much more.
He also laid out what the company has done in the ad sphere, giving more credence to reports that Comcast could be a potential partner for Netflix’s ad-supported option.
“We have our television business operated as one business,” he said. “Peacock is not a separate business. We program it across linear and Peacock. We operate together, we manage it together and it’s really mirrored by [NBCUniversal Chairman of Global Advertising & Partnerships] Linda Yaccarino’s team. She’s kind of revolutionized what we call the one platform approach.”
As the streaming wars enter their next phase, it seems as though more collaboration between platforms is not only possible, but inevitable. Whether that is via advertising agreements like the ones that Netflix is currently discussing with multiple potential partners or future bundlings and/or mergers, these execs are likely to be at the center of whatever comes next for streaming.