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Netflix’s Latest Claim That It Wants Data Transparency Rings Hollow

Netflix CEO Reed Hastings discussed data transparency at a recent event, but the company's actions speak louder than its executive's words.

WHEN THEY SEE US

“When They See Us”

Atsushi Nishijima/Netflix

Months after Netflix said the company would begin being more transparent about releasing its viewership data, the streaming service’s head confirmed that would be a good idea — in the United Kingdom. Maybe.

Netflix CEO Reed Hastings discussed various aspects of his company during a keynote at a Royal Television Society conference in Cambridge earlier this month, and the topic of the streaming service’s data transparency came up several times. Like most streaming services, Netflix does not regularly release viewership data about its films and television shows, though the company has repeatedly pledged that it would become more transparent.

Hastings told Scottish journalist and keynote moderator Kirsty Wark that Netflix would be open to allowing BARB, which tracks television ratings in the United Kingdom, to measure Netflix’s viewer data. However, Hastings implied that most large data collectors do not have the technology to measure engagement on streaming services and said the decision would be up to BARB.

There are a multitude of reasons to be skeptical about Hastings’ claim, but in fairness, data collectors such as Nielsen — whose data on American audience measurement is used to set advertising rates — have been slow to adapt to the rapidly changing ways that audiences consume television. Several weeks ago, Nielsen announced its measurements would begin including “out of home” viewing, such as at restaurants, hotels, and other people’s homes in fall 2020. That’s a positive change that will result in more accurate ratings, but it’s also long overdue.

Nielsen said as far back as 2017 that it had the technology to track viewership data on streaming services such as Netflix, but Netflix bluntly refuted that claim. Nielsen does track Netflix viewership on TV sets, but it doesn’t have the technology to track viewership on other devices (such as phones), and the company’s Netflix data is largely ignored by industry power players and news organizations alike.

It’s difficult to accept Hastings’ answer during the Cambridge keynote in good faith, given Netflix’s notoriously poor record on data transparency. The streaming service’s refusal to consistently release viewership data has long been a source of annoyance in the journalism and entertainment industries, and the company routinely withholds audience metrics from the directors and stars of its various projects.

Hastings’ Cambridge comments came a few months after Netflix COO Ted Sarandos said the company would be more transparent about what people watch on the service. Since then, Netflix has irregularly tweeted about its original projects that have allegedly broken the company’s viewership records, but that’s nothing new.

Gaten Matarazzo, "Stranger Things"

“Stranger Things” is one of Netflix’s championed shows, but verifiable viewership numbers remain unknown.

Netflix

The closest the company has gotten to data transparency comes from its United Kingdom Twitter account, which recently began sharing a weekly list of its most-viewed content, though it doesn’t provide specific viewership data. Of course, nobody would be happy even if Netflix shared such data because — as Hastings accurately noted — it would be much more credible if a third-party firm tracked and released such data.

A company faces pros and cons with regards to viewership data transparency, and Netflix is not alone in its refusal to release viewership numbers. None of the major streaming services release viewership data, and while there’s no word on whether upcoming platforms such as Disney+ and Apple TV+ will release viewership numbers, history suggests that they almost certainly won’t. The Disney-owned Hulu doesn’t share its viewership numbers, and Apple is notoriously secretive about everything.

For traditional TV platforms, viewership data is key to securing advertising deals. If data indicates that more viewers are tuning into a particular show, networks will be able to sell advertising slots for a more lucrative price. Subscription-based services such as Netflix don’t have in-show advertisements, so are presumably less incentivized to share viewership numbers.

Social media buzz and other types of word of mouth can indicate when a particular show is popular, but not with credible accuracy. Companies such as Netflix may want to hide data to mask when its high-budget projects end up being commercial flops — or to help them negotiate deals with talent — but this is all guesswork. Like the viewership numbers themselves, Netflix has been cagey about justifying its data secrecy.

The trend of streaming services not releasing viewership data could end if advertising becomes more commonplace. Hulu reportedly had 58 million ad-supported viewers as of May, and NBCUniversal’s upcoming Peacock service will be ad-supported (though there will be an option to pay for an ad-free experience). The ad-supported version of Hulu will almost certainly become more popular in the coming months, as the ad-supported version will be included in a discounted Disney+ bundle. If the ad-supported versions of streaming services take off, it could incentivize their corporate owners to be more transparent about viewership data.

Outside a legislative effort, which is extremely unlikely, companies are not going to be more transparent about viewership data unless there’s an economic incentive. In short, Netflix’s pledge to be more transparent about viewership data is nice, but don’t believe it until you see it.

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