← Next in Media
Next in Media
Breaking Down the Netflix vs YouTube Streaming War
00:19:58
Next in Creator Media talked with Business Insider media correspondent Lucia Moses about why Netflix is suddenly paying more attention to creators and YouTube, and what this might mean for the future of talent deals and distribution. Moses also weighed in on Amazon's Beast Games, Netflix's ad business and the state of Hollywood.
Loading summary
Transcript73 lines
- [00:00]
A
Looking to get more out of your YouTube advertising? With view Planner, you can buy with total confidence and clarity. View Planner is a verified YouTube brand suitability and contextual targeting partner in the YouTube measurement program. Recognized by Google as a trusted and independent leader in driving and measuring performance on YouTube, their advanced technology gives you a clear edge. Only with View Planner we're talking custom curated contextual collections, exclusive content strategies, transparent reporting and AI driven optimization to deliver real results. Don't let your budget go to waste. Partner with View Planner and experience the difference. Visit viewplanner.com now to unlock your full advertising potential on YouTube. That's V U E P L-A-N-N-E-R.com this week on Nexting Creator Media, I chatted with my old friend and colleague Lucia Moses, senior correspondent at Business Insider, about the brewing talent battle between Netflix and YouTube. After years of ignoring the creator world, suddenly Netflix is courting YouTubers, exploring deals with podcasters which could shake up what premium streaming means in the current market. Bushi and I also talked about Disney's confusing sports strategy, whether Netflix's ad plan is finally working, and plus Amazon's sudden interest in the creator economy. Lots to talk about. So let's get started. Hi everybody. Welcome to Next in Creator Media. I'm Mike Shields. I'm here with Lucia Moses. She is a senior correspondent at Business Insider. Hey Lucia, thanks for being here.
- [01:29]
B
Hey Mike, it's great to be here.
- [01:31]
A
Lucia and I are old colleagues from Adweek, probably a decade ago or so. So I'm really excited to connect with you and talk. Lucia covers everything From Netflix to YouTube to podcasting to the Hollywood changes going on. So great time to talk to you. You had a story this week about a lot of people have been wondering like the Netflix YouTube clash that maybe people didn't expect is becoming real. What does YouTube need to, what does Netflix need to do about things? You mentioned that they are talking to podcasters. Talk about what you learn there and what's going on in general.
- [02:03]
B
Yeah, yeah, it's really interesting. It's, it's sort of an evolution of Netflix working with creators. So you know, you go all the way back to when they, when they had Cobra Kai, which was born on.
- [02:16]
A
YouTube but is a huge hit on Netflix. Yeah, it's kind of ironic.
- [02:19]
B
Yeah. And you know, they, they have evolved in how they talk about YouTube. They've talked about it in the past as, as a threat. You know, they know it's a threat to, to people's time. More recently, I've noticed them talking about it in more conciliatory terms, like, you know, yeah, we have our strengths, you know, we're, you know, top shelf, you know, premium long form content and YouTube is shorter form and you know, obviously, you know, YouTube doesn't pay for its, its content. It doesn't have a 17 billion suddenly saying that.
- [02:51]
A
That's a lesser thing. Yeah, in a way.
- [02:53]
B
Yeah. But lately, you know, they, they've talked about how, you know, we have this great history of, of finding creators in other places and, and like upping the game and bringing them to Netflix and making them successful. So next evolution of that or next, I guess stage of that evolution is looking at podcast creators, creators who are podcasters and thinking about how they could work on Netflix as like, as they like take another stab at the idea of like the talk show on, on Netflix.
- [03:28]
A
Right. Do you think that is there while you could take a creator? There's a million kinds of creators on YouTube. But that might not translate so well. Some of the formats might not translate as well as that as a podcaster might, where it is very talk showy, it's looser than maybe Letterman or something, but it's, it might work better on that platform than other things.
- [03:46]
B
Yeah, I think, you know, a criticism of the past stabs that they've taken at doing like talk shows on the platform is that they'll, they'll take somebody as, as is their practice. You know, they'll, they'll really produce it. You know, it'll look very, you know, slick and snazzy. Yeah, people want to see creators just kind of do their thing like, you know, hold forth and you know, they, they want to feel like they're, they're hearing directly from that person.
- [04:12]
A
Right. The authenticity, the, the unpolishedness is sort of a part of the appeal, a part of what it is.
- [04:17]
B
Yeah, that's a core feature of it.
- [04:18]
A
You know, it's funny because you talk to the traditional media companies and they've been in going through various stages of denial, have been, you know, very much like, you know, advertising doesn't work as well. It's short form as people are screwing around and then they've had to kind of maybe accept, well, you know, this creator thing is kind of humongous and it's like a generational shift in the way people entertain themselves. It had to catch Netflix a little bit by surprise because they were, they're doing great. It's not like they're struggling. They've been so ascendant. But YouTube, all of a sudden on the television is passing them quickly. I guess everybody has to kind of react to that in some way.
- [04:51]
B
Yeah, yeah. And you're seeing every major streamer, every global streamer is doing some version of this. Right. You sound like Amazon getting into doing the deal with, with Mr. Beast with beast Games. And Amazon is like, probably leaned in the most when it comes to creator content.
- [05:08]
A
I want to come back to Amazon if we can. What do you think? Netflix? Let's, let's stick to them for a second. Are they, how do you feel like they're. Besides the, the whole creator push and how do they figure out that use case? What, what's your take on the ad plan? Like for a while it seemed like it was going slow. They're getting some traction. I don't know how big the audience is still because they use kind of fuzzy numbers. But what's your sense in the market? Are, are they getting where they need to be?
- [05:33]
B
I think there, there is a sense of optimism, like they, they're going to figure it out. Maybe they're not there yet, but they are going from the, the crawl to the walk phase. You know, over half of the people who sign up for Netflix now in the markets where the ad tier is available are taking the ad tier. Not for nothing. They've raised the price on the, the ad freeze. It's, I don't know, close to 20 bucks or something a month.
- [05:58]
A
And it feels like it was seven bucks not that long ago.
- [06:00]
B
Nothing. That's all by design. They want you to take the ad tier. So they're kind of engineering that, I think something like. And you know, the estimate is like 45, 50 million US users on the ad tier. That's bigger than it used to be, but still small from an advertiser perspective. I think Disney and Amazon are like twice that.
- [06:21]
A
Right. And of course, Amazon turned on advertising for everybody overnight, where Netflix either been trying to do it gradually, that's gotta, that's gotta sort of drive them a little nuts that they were trying to build this thing and then all of a sudden Amazon came around the corner and FL the market.
- [06:34]
B
Yeah, yeah. It doesn't help help your. Your pricing, but, you know, they are, they're going to be turning things on like programmatically this year for the US So that'll their own stuff.
- [06:45]
A
Right. With their own tech now.
- [06:46]
B
Right.
- [06:47]
A
It'll be interesting to see how that does that. You know, does that bring in a whole bunch more demands and make it easier to buy? I want to come back a little bit Circle back to the, the whole podcaster thing. It's, you know, it's obviously having a big moment when you see how many post election everyone's into this alternative media hype and that's how Trump did a million of them and that's how he won. Or, or that's the thing. Do you, do you think podcasting, it's, it's kind of been this, it's been a fast growing medium for a while, but I feel like it got stuck in the audio bucket like it was, it was a radio alternative, which. Not a bad business, but it's not monstrous. Do you think that's going to change? Could this get into the video budgets and the upfront conversations, some of the podcasts out there, or is that a stretch?
- [07:26]
B
I could see that happening. I mean, I, I think podcast listeners are used to ads. You know, they're used to those host red ads and increasingly, you know, the, the programmatic ads. So it's friendly to ads. And I feel like YouTube making a lot of noise, showing that they are not only a home for podcasting, but for video podcasting. For watching podcasts is kind of like waking up people again to the fact that, you know, this is not just for listening, this is for watching.
- [07:58]
A
Yeah.
- [07:59]
B
This is something like Gen Z is like really doing in a big way. So I think it's going to be another factor that gets advertisers to give, give these podcasts a second look.
- [08:09]
A
And you mentioned in your article this week, I think that it's habitual, which, you know, brands like that, you know, they like that idea because it's television, like when it's consistent, when audiences are accumulated consistently.
- [08:20]
B
Yeah, yeah. Appointment viewing, I mean, if you want to like zoom out, it's just like another form of episodic content.
- [08:27]
A
Yeah.
- [08:28]
B
Whether it's, you know, video or audio, it's. It's appointment viewing.
- [08:31]
A
What did you think this week? It's not super surprising, but with YouTube's Neil Mohan does this annual letter and they announced that they're the majority of their consumption or at least viewing time, I think is now on TV versus desktop and mobile, which you can see it coming, but it still feels like that's significant. Do you think that's going to resonate in the market in a big way? Does that mean anything?
- [08:52]
B
Yeah, yeah. Like you said, you know, you see it coming, but it's, it's sort of like when in the past year they became like number one in the Nielsen gauge, you know, getting the biggest share of TV viewing. You Know, it happens one month. That's one thing. It happens for six months in a row is another thing. When you pass these milestones, then I, I feel like, you know, there's really a tipping point. Everybody starts writing about it. Everybody, you know, everybody has their hot takes. Everybody starts talking about it and it just, it becomes more real. So. Yeah, and YouTube has been, you know, you, you have some advertisers or ad buyers like, you know, still kind of put them in that less premium bucket, you know, second tier bucket. You know, it's not really TV. So this is like another moment for YouTube to like, drive home that, you know, this is where the viewing is. This is where. This is where TV dollars, those, yeah, big TV dollars should be going.
- [09:45]
A
Yeah. And they've always had to fight that, you know, the, the brand safety aspect because it's so wide open. I wonder if that's going to change because brand safety seems like it's a little bit out of vogue right now. And, you know, you can't, you don't want to be seen as censoring or, you know, we're, we're in the masculine energy era again, so no one cares about those issues.
- [10:04]
B
It makes it easier for them to make that argument.
- [10:06]
A
Right, right. To dismiss those concerns.
- [10:08]
B
Yeah. Although there's like, there's two kinds of brand safety. There's, there's, well, there's the terrible stuff, like, you know, Nazis and hate stuff, and then there's just the, you know, oh, it's not appropriate for our brand because it's like, you know, cat videos or we have different values stuff. You know, it's not, it's not slick enough. It's not, it's not premium enough.
- [10:26]
A
Right. Nobody's getting hurt. But, yeah. Welcome back to Amazon. You mentioned Beast Games. It's been kind of fascinating, like, because you wrote about. I'm of two minds of this and I don't know, it's hard to, it's hard to tell how big it is. It's, you know, if you look at some of AM Amazon's numbers, it's impressive. Mr. Beast tweets about how it's number one on these markets. I don't know that it's like a cultural phenomenon that I'm. You might have expected. I don't know. But you're seeing Hollywood look at that and say, we got to get our own, we want to get our own version of that. So what's the, I guess, what's your overall take on this Beast Games experiment? Where it is now and Then what? Why is Hollywood trying to replicate this?
- [11:03]
B
Yeah, it's like back to what we were saying about Netflix. These big global platforms, they need more stuff and they need the stuff that's, that's popular with, with young audiences. And they see the, the rise of YouTube as a force in, in TV viewing. And they realize that there's all this viewing going on over there or media consumption, whether it's like listening to podcasts or playing video games or watching creators and you know, they would be foolish to ignore it. Right. So I think, you know, the, the Amazon and Beast games, the interest in, by, by these streamers and working with creators has been going on for a while. Obviously the Amazon, you know, getting the big million dollar, you know, deal with him is, you know, really puts it on, on the map. It, it'll, it'll continue. And I think, you know, the, just the, what's holding it back is there's still this, you know, thinking among the legacy studios that there's still a little bit of a discomfort level with working with creators, you know, who want to own their own stuff and they've had.
- [12:14]
A
Control of their whole career. It's very different.
- [12:15]
B
Totally, totally control everything. And they're not, you know, let's face it, you know, Mr. Beast is in a class by himself. There's him and everybody else.
- [12:23]
A
Right.
- [12:24]
B
There's no other Mr. Beast. There's only a handful, I guess, of creators who really have what they call like billboard quality.
- [12:31]
A
Right. You know, he was like, he was.
- [12:32]
B
On Good Morning America, you know, no explanation needed.
- [12:36]
A
Right, Exactly. Yeah. So I don't know how many other kinds of deals are in, are going to be in that territory is a good question. And I'm sure, plus a lot of traditional media companies, they're, first of all, they're, they're in a tough spot right now, but they're all, they also have scars from the previous era when they bought MCNS and they invested in creators and it didn't work. So I'm sure there's some hesitancy there. Shift gears a little bit. What you've been writing about Disney recently, they had a pretty interesting earnings numbers recently where they're, they're in a good place profitability wise, but Disney plus is losing some subscribers. What analysts make of what they're doing, whether they made the FUBU deal they're going for, they're talking about other bundles, but then they're also going to ESPN on its own. What's your take on what's the analyst community saying about there I mean, to.
- [13:20]
B
Your first point, it's tricky. I think it shows that it's hard to have profitability and streaming growth at the same time. It's one or the other and everybody. Wall street wants them both.
- [13:33]
A
Yeah. And it's not going to bite you in the end at some point when Disney plus is not putting out as many shows, so it's maybe more profitable. But I don't know if it's getting the habit you always talk about.
- [13:42]
B
Yeah. And if you, I think if you, if you add up Disney and of course they have Hulu, it's still way smaller. Maybe it's about the same as Amazon, still like half the size of Netflix. When you think of, like, what Disney occupies in, in your headspace.
- [13:58]
A
I know.
- [13:59]
B
No, it's, it's half.
- [14:00]
A
And you look at the gauge numbers, it's never in the same territory as some of those big guys.
- [14:04]
B
Yeah, yeah. Now Disney, like, as a overall distributor is, you know, the whole company is, is the biggest about neck and neck with YouTube. But, you know, if you're just talking about Disney plus, you know, where they think their future growth is going to come from, you know, yeah, we're starting to show some profitability. That's great. But then to your point, what, what about growth? Sports is, you know, it's, it's suddenly become like, very complicated this year. A lot more options for sports fans. And I think if you're, maybe if you're a hardcore fan, you have it figured out, like in the YouTube live household a year. But if you're a more casual fan, it's, you know, where do you go? There's, there's all these skinny bundles now. You know, Disney with its Fubo deal.
- [14:50]
A
Right.
- [14:51]
B
You know, live with, with Hulu Live content. They're still talking about their, their flagship ESPN app coming out in fall. You know, and that's why they're, they're starting to get questions, more questions about, like, well, you know, how do you explain the strategies is, you know, how, how is it not going to be confusing for, for viewers?
- [15:10]
A
I find myself confused and I am a pretty big sports fan. I'm always trying to think about what makes more sense. And I'm actually, I'm still, I'm still hanging out the cable because I have my local teams and I'm thinking about, there's, there's the Gotham app and then would it make Sense to get ESPN and YouTube TV and you know, at a certain point it's kind of insane. And I know there's a new bundle Coming along for one of the satellite guys. I don't know if that's going to get any real traction because all these things feel incomplete in a way.
- [15:35]
B
Yeah, you have to think that at some point there's going to be some consolidation.
- [15:40]
A
It seems, it's interesting because it seems inevitable. Like you see to be had a really big numbers for the super bowl. There's a streaming first audience for these live events. I just, I wonder if we're going to a place where you're going to have all the big sports rights go to streamers and what does that do to the big media, the big media companies and that's a ways away, but I wonder if that's around the corner and it's really going to change dynamics.
- [16:00]
B
Yeah, Everybody, you know, wonders like, you know, where is it on the calendar and the big leagues, you know, still have that good relationship with the, the networks and want to, want to keep it and they kind of, kind of want to have it all. So I guess the biggest losers are, are the sports fans. Right? Because it's not all just like it's harder and more expensive entertainment. You know, entertainment, scripted entertainment just like all moved over to, to streaming.
- [16:25]
A
Right.
- [16:25]
B
Sports fans, you know, you need like, you know, excelsi to kind of figure it out.
- [16:30]
A
I want to ask you, you've been, you've been writing just a lot about the state of Hollywood lately and, and what kind of, you know, they're making less. There's consolidation, a lot of stuff is moving out of la. This is before the horrible news the last few months. What's the vibe right now when you talk to the Hollywood community or is there just neg, negativity, fear, uncertainty and where do you think? What are some indicators of where the business might be headed?
- [16:54]
B
Yeah, it's. This shift out of Hollywood has been happening for a while. I mean, could look at it two ways. I mean Hollywood is. Still has it like the lion's share of the, of the industry. It is, is the bedrock. But you've got really good, good financial incentives coming from other states, other countries, Canada, overseas. And that I think is going to be, you know, LA will talk about like sound stages and talent and services, but those incentives are, are the biggest driver of where, where the productions are going to go. And yeah, so there's a lot of malaise. You've got a lot fewer shows getting made. You've got, you know, fewer episodes of those shows, so a lot of less work to go around. On the other hand, you know, there, there is growth. You Know, in other areas like you know, the creator economy and some, some growth in gaming. But you know, that doesn't just replace what's happening. No.
- [17:52]
A
And it's interesting bringing back to the creators. You're seeing them and you know, Mr. Beast is famously in North Carolina, but like Neil Mohan was talking about, this creator's got a studio in Birmingham and this one's in Texas. And dude perfect, like they're, they're not central or they're, they're definitely don't seem to be tied to la, which I don't know what that means for the future of the business, but it's, it seems like it's very fragmented.
- [18:12]
B
Yeah, I mean, I think. Well, that's true. It's. It's also true that, you know, like, like the rest of legacy Hollywood, the creator economy in, in, in LA is, is very strong as well. But for sure there is a strong narrative about, you know, like dude perfects and, and others, you know, setting up shop and other places.
- [18:34]
A
Lucia, what else should we be looking for the rest the next couple months of this year? What are you eyeing in terms of like the ad market? The upfronts are even coming soon. What, what are, what are some of the trends or things you're, you're, you're.
- [18:44]
B
Looking at right now where you know, the, the, it seems like you got like Nielsen kind of reasserting itself.
- [18:52]
A
Yeah.
- [18:52]
B
If you're paying attention to like to you know, the granular buying, currency wars. Yeah. Ongoing, you know, demise of the, of, of the cable networks. You have a lot of potential, like really big M and A on the horizon. You've got these legacy networks being, being spun off. You got merger, merger of these two ad holding companies. And everyone's talking about the potential for like a lot of people being out on the street as a result of that.
- [19:20]
A
Seems like, it seems like a deal friendly environment. But then, you know, you have the, the Trump hates media factor. So you know, you know where these things are going to go.
- [19:27]
B
Right. Right. Do I, you know, if I don't have to do a deal this year and I can wait till things, you know, I see how things are playing out. Maybe you do that. Right.
- [19:35]
A
Right. Should be, it should be fascinating. Well, we're going to keep reading your coverage. Thank you so much for your time here. Great conversation, Lucia.
- [19:41]
B
You bet. Glad to do it. Thanks.
- [19:43]
A
Thanks again to my guest this week, Business Insiders, Lucia Moses and my partners at View Planner. If you like this week's episode, please take a moment to rate and leave a review. We have lots more to bring you, so please hit that subscribe button. We'll see you next time for more on what's Next in Creator Media. Thanks for listening.