Streamer shifts to reporting number of hours viewed

Netflix has said it will change the way it measures viewership, as it confirmed that South Korean TV phenomenon Squid Game drew 142m subscriber households in its first month to become the service’s biggest show ever.

The show debuted on 17 September and has ranked number one in 97 territories including the UK.

In the letter to shareholders sent as part of its third quarter earnings on Tuesday (19 October), Netflix said later in the year it will shift to reporting the number of hours viewed from its current metric, which records the number of accounts that have watched at least two minutes of a piece of content in its first 28 days on the platform.

“We think engagement as measured by hours viewed is a slightly better indicator of the overall success of our titles and member satisfaction,” said the company.

“It also matches how outside services measure TV viewing and gives proper credit to rewatching. In addition, we will start to release title metrics more regularly outside of our earnings report so our members and the industry can better measure success in the streaming world.”

For TV shows, Bridgerton’s first series is the leading title by hours viewed on 625m, followed by Money Heist series four on 619m, Stranger Things series three on 582m, The Witcher on 541m, and series two of 13 Reasons Why on 496m.

Bridgeton was still the champion by accounts viewed on 82m, followed by Lupin’s first series on 76m and The Witcher on 76m. Tying in fourth and fifth were Sex/Life series one and Stranger Things’ third run on 67m.

Overall the streamer beat its forecasts adding 4.4m net paid subscribers to reach 213.6m global members in the third quarter. Revenues grew 16.3% to $7.48bn (£5.43bn) and operating income climbed 33% to $1.8bn (£1.31bn year-on-year).

Netflix has forecasted an 8.5m rise in net paid global subscriptions in the fourth quarter to reach 222m. Earnings per share gained 83% and beat forecasts to reach $3.19 (£2.31). Netflix shares fell 1.4% after hours.

For the second consecutive quarter Asia-Pacific was the biggest membership driver with 2.2m paid net adds, while in Europe, Middle East and Africa 1.8m was added. Despite slower growth in US, Canada and Latin America, the company said there was still “ample runway for growth”.

The results followed a slow second quarter impacted by Covid-related production delays and the company promised what it expected to be its strongest fourth quarter content offering yet. 

Looking to 2022 the company anticipated a “more normalised content slate in 2022” with a greater number of originals compared to 2021 and a more even spread across the year – assuming no new Covid waves or unforeseen events that cause large-scale production shutdowns.

Netflix admits Dave Chapelle ‘screw-up’

Ted Sarandos

Ted Sarandos

Meanwhile, Netflix co-CEO Ted Sarandos has admitted he “screwed up” over his handling of internal communications in the Dave Chapelle debacle as a group of trans and LGBTQ+ staff plan a walkout at the Los Angeles head office on Wednesday.

The executive told the US trades on Tuesday night he had mishandled staff concerns after they expressed dismay over the platform carrying the US comedian’s latest stand-up special The CloserHe agreed that content could have a positive and negative impact in the real world.

However, Sarandos stood by airing the show and said he was against carrying a disclaimer at the start, adding that it was already age-restricted and the comedian himself gives a clear warning about content at the outset.

The Closer contains jokes that have upset the trans community and has sparked a backlash from organisations like GLAAD.

A version of this story originally appeared in our sister publication