TV Answer Man, do you think Netflix will ever offer live sports? Amazon does it. Peacock does it. Apple TV+. Hulu too. I could go on. It seems like it would be a real winner for Netflix if they had live sports, too. Do you think it could happen? — Manny, Orlando.
Manny, as you note, several Netflix streaming rivals offer live sports. For instance, Peacock and Apple TV+ recently captured the exclusive rights to dozens of MLB games while Amazon Prime live streams National Football League games on Thursday nights during the regular season, and 21 New York Yankees exclusively in the New York market. The games are free to Prime subscribers, adding extra value to the etailer’s shopping membership.
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Netflix, however, has consistently said it has no plans for live sports, a position it has held for years.
“To follow a competitor, never, never, never,” Netflix co-CEO Reed Hastings said in 2018. “We have so much we want to do in our area, so we’re not trying to copy others, whether that’s linear cable, there’s lots of things we don’t do. We don’t do (live) news, we don’t do (live) sports. But what we do do, we try to do really well.”
Company executives last week were asked again about live sports after Netflix posted a first quarter net loss of 200,000 subscribers. But Netflix’s other co-CEO, Ted Sarandos, again poo-poohed the possibility that the streamer will try to use live sports to generate new subscribers.
“I’m not saying we never would do sports, but we would have to see a path to growing a big revenue stream and a big profit stream with it,” he told financial analysts following the release of the first quarter report.
Why does Netflix have a problem with live sports when others don’t? Two reasons, according to this reporter.
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1. Money
TV networks and online services such as Amazon and Apple pay millions (and sometimes billions) of dollars for the rights to air professional and college games. While Netflix annually spends several billion dollars on programming, even this well-heeled company doesn’t want to get into a financial arms race for live sports.
2. Technology
You may not recall some of the technical glitches that Netflix incurred in the early days of online video, but it wasn’t always pretty. The term, ‘buffering,’ became a common word in large part to Netflix.
But Netflix has made great improvements over the years in delivering a reliable stream for non-live programming. While it’s not perfect, the overwhelming majority of Netflix’s shows and movies stream error-free, even in a home that has less-than-average Internet speed.
Netflix understands, however, that live streaming can be a bag of hurt, to paraphrase what Steve Jobs once said about Blu-ray discs. The backroom technology behind live streaming is more complex, and less reliable, than non-live streaming.
Netflix, which has been remarkably prescient regarding video trends, may be wise in staying away from the live streaming business. However, if subscriptions continue to fall, the financial community may pressure the company to reconsider with some analysts already calling for Netflix to start investing in live sports.
Manny, hope that makes sense. Happy viewing and stay safe!
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