Netflix is trying to be more transparent with its creatives about how it counts a view on an original series or movie, and a letter sent to the British government includes three new descriptors: starters, watchers, and completers.
The three new categories are part of the most in-depth look yet at a reported method that helps Netflix decide whether a show should be canceled. According to a letter sent to a UK Parliament committee, Netflix tracks ratings with those three metrics with directors and producers, and based on previous reports, may use that breakdown to determine if a show is worth renewing. The letter adds that Netflix believes “these two metrics will give our creative partners a broader understanding of how members engage with their title from start to finish.” The letter is part of an ongoing examination of video-on-demand (VOD) and subscription-video-on-demand (SVOD) services on public television in the UK.
Starters are “households that watch two minutes of a film or one episode” in a series. Completers are “households that watch 90 percent of a film or season of a series.” These are the two main data points that Netflix gives to its producers and directors, according to the letter. This data accounts for the first seven days of a release, followed by the first 28. The third data set is watchers, a more general metric that Netflix often includes in its quarterly earnings letters to shareholders and shares with the public. Households that watch 70 percent of a movie or one episode in a series are considered “watchers.”
“Depending on how useful our partners find this data, we will consider sharing it in more countries outside Europe and North America,” the letter reads.
Completers are “households that watch 90 percent of a film or season of a series”
The third data point is one most people will be familiar with as Netflix often uses it to tout record-breaking series. Most recently, Netflix announced that Stranger Things’ third season became “the most watched season to date,” with “64 million member households” watching it within the first month of its release. This data is based on people who are classified as watchers. A footnote in Netflix’s fourth quarter earnings letter to shareholders in 2018 explained that, “due to their highly variable length, we count a viewer if they substantially complete at least one episode (70 percent).”
These viewership numbers are extremely important to creators, akin to traditional Nielsen ratings in broadcast and network television. Netflix doesn’t work directly with Nielsen to track traditional ratings, and reportedly uses an efficiency metric to determine if a show is worth renewing. Essentially, it’s a ratio that determines the cost of a show to the viewership, and whether the series is instrumental in retaining subscribers at risk of canceling their memberships or bringing in new subscribers. A show like Stranger Things does both, while shows with smaller, dedicated fan bases like The OA often get canceled.
Some writers and producers have expressed frustration with the lack of transparency over numbers. Tuca and Bertie creator Lisa Hanawalt criticized Netflix’s algorithm when her show got canceled, prompting other showrunners to speak out about their own concerns over how Netflix executives value a show and its audience.
Netflix executives like CEO Reed Hastings and chief content officer Ted Sarandos have addressed criticism that they’re not transparent enough, and promised earlier this year to do better.
“I would look at it like these are less financial metrics as they are cultural metrics,” Sarandos said during a previous earnings call in January. “I think it’s important for artists to understand, to have the audience also understand the size of the reach of their work. So that’s why you’ll see us ramping up a little bit more and more and giving out — sharing a little more of that information.”