Streaming Wars: Could Netflix’s Cancellations of Shows Like Daredevil, The OA, and Sense8 along with Its Price Increases Jeopardize Its Position as Market Leader?

Streaming Wars: An ongoing look at the trends and changes the streaming services are bringing to the television landscape.

Netflix currently stands above its competition as the top streaming service, controlling over 70% of the global SVOD market and approaching two hundred original series in its catalog. But while the streamer has been very prolific with its original content (which includes exclusive movies that are also approaching the two hundred mark), its strategy for rolling out new series has potential flaws that could hurt the streamer in the long run. Netflix has used its originals to drive new subscribers to the service, but it lacks a long-term commitment to the shows it produces, and this churn-and-burn approach–along with multiple price increases–will certainly have consequences in a market that is growing ever more competitive.

In a previous article, I looked at sci fi and fantasy originals on Netflix (and to a lesser extent Amazon and Hulu) and suggested that the streamer had a cap of about three to four seasons for these shows. I have since done a deeper dive into the data, bringing in a broader spectrum of Netflix originals. For this, I looked at all of the dramas, comedies, and animated series that are not targetted specifically at younger viewers. Using this larger sample, the previous assumptions still hold up with the streamer typically keeping its shows around through about the three-season mark or less.

For this analysis, I looked back to when the streamer started producing original programming. I included shows that are active or have ended, that have at least one season, and we know if they will return for a second season or if they have been cancelled. For shows that Netflix picked up from other networks–such as Black Mirror and Lucifer–I am only counting the seasons that have run as originals for the streamer. This produced a population of 139 shows tracked, 38 of which (27%) were sci fi / fantasy.

Of these shows, 80% had at least two seasons (87% among genre entries). That means only 20% were cancelled after one season, giving shows a much better survival rate in their freshman years than the Big Four broadcast networks. Looking at shows from the old-school nets over the past ten years, we see a 61% cancellation rate after one season, 59% for genre entries (more on that in a coming post). Surviving for at least three seasons on Netflix were 31% of the shows tracked (32% for sci fi and fantasy). But the chances of getting to a fourth season or more dropped to 9% with only 5% sticking around for five seasons or more. Of the shows that have survived for at least five seasons on Netflix (most of which were first-round of originals), six of the seven have ended or will end with their coming season.

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So while Netflix originals have a high survival rate when they first start, that tapers off very quickly starting with the second season. And the chances of a series surviving past its third season are even slimmer. Extended runs are rare with the streamer, especially for shows from the past five years or more, with Black Mirror and Stranger Things among the few that currently have a chance to make it to five seasons or more (both have currently completed three seasons on Netflix and are awaiting renewal announcements).

Shorter runs are not necessarily a bad thing, especially if the creative team is aware in advance that they may only have a few seasons to work with. But shows like The OA and Sense8 were cut short with no resolution (the latter did receive a series finale, but that did not provide a satisfactory wrap up for fans), leaving viewers frustrated and angry with the streamer. The infamous cancellation of the Daredevil and the other Marvel shows was chalked up by many to a spat between Netflix and Disney since the Mouse House is starting its own streaming service. But it appears that the streamer was actually the driving force in that decision.

Netflix looks at its originals as a way to drive new subscribers to the service. And just as shows typically have their largest audience in their first season on the broadcast networks and cable channels, the Netflix shows tend to draw the most subscribers in their first year. Diminishing returns set in after that, making them less profitable for the streamer. In addition, Netflix structures its deals for shows in such a way that it pays a bonus for each additional season beyond the first, and that starts to ramp up after the third year. So these shows become more expensive, further cutting into the profits and giving the streamer less of an incentive to keep them going for an extended run. Thus, shows like The OA that have their story planned out for multiple seasons have a longshot at best of realizing that goal (to be fair, its also a longshot on the old-school networks).

So when it comes down to it, Netflix is probably just as bad about cancelling its shows as the broadcast networks and cable channels. They may survive past the first season, but don’t expect too much more beyond that. And since the per season episode order (usually eight to ten) is low for the streamer, shows don’t stick around much longer than the 22 eps you would expect from one season on the broadcast networks, even if the Netflix show has three seasons.

This is quite significant as more and more streaming services ramp up and start offering original programming.  Disney+ and Apple TV+ launch in November of this year with HBO Max and Peacock starting up next year.  There are only so many streaming services that the market can bear, and each needs to make sure it is positioned in such a way as to remain viable amidst the competition crunch.  Netflix is currently receiving bad press for its cancellations, as well as its price increases, and just recently a #CancelNetflix drive took off on social media in protest of its cancellation policy.

Currently it appears that Netflix has proven to be as short-sighted in its decision-making concerning its scripted programming as many of the broadcast networks and cable channels.  Those old-school networks are finding it much more difficult to compete in a market that offers increasingly more viewing opportunities.  And while Netflix may be the leader in SVOD now, its lack of commitment to its original content as well as its high price point could hurt the service in the long-run and allow one or more of the other streaming services to supplant it in the coming year or so.

Vote on whether you will drop Netflix in protest of its cancellations and prices increases at this link.

More from CancelledSciFi.com:

Keep up with the ratings developments and the status of all the currently airing sci fi and fantasy shows with our Weekly Roundup posts. And join the #CancelledSciFiArmy on Twitter to bolster our ranks and help us fight for the struggling and cancelled sci fi and fantasy shows.

Follow our Sci Fi TV News Briefs column for a rundown of the latest news and updates on genre television.

Check out our Sci Fi TV Schedule for debut and season finale dates and follow our Weekly Listings for a rundown of the shows airing in the current week.