Netflix CEO Ted Sarandos hints at more live events, but sports is still a mystery

Netflix is dominating the streaming war — and live sports is its next field to conquer.

May 29, 2024 - 06:30

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Netflix CEO Ted Sarandos hints at more live events, but sports is still a mystery

It's no secret that Netflix is winning the streaming wars.

The streamer with over 80 million subscribers in the US and nearly 270 million worldwide as of Q1 2024 has become a staple in households and shaping media culture.

Netflix (NFLX) navigated through a tumultuous 2022 by changing some key strategies, including the addition of an ad-included plan, and has seen a massive resurgence with it stock up over 60% in the last 12 months.

The question is what could be next for Netflix — and one of the big leaps many are thinking it could take is integrating into live sports.

Netflix has already dabbled with live events over the last few years, including massive success from "The Roast of Tom Brady" that aired on May 5. That roast saw a combination of two categories that Netflix has seen success in: stand-up comedy and sports storytelling.

Speaking on "The Interview" with The New York Times on Saturday, May 25, Netflix CEO Ted Sarandos talked about how the company has embraced live events and has unique fan insight from it.

"It's really incredible the conversation that gets driven around the world around a live event," Sarandos said. "In the world of on-demand and total control, the novelty of a big live event, if it's the Super Bowl or the Tom Brady Roast, is people get very excited that they're all watching it at the same time. What we saw with the Tom Brady Roast was that it was driving so much conversation around the world that the audience kept growing and growing and growing minute on minute and people kept coming to it."

Streamers like Netflix were centered around on-demand products, while the live television shows like sporting events or awards shows stayed on linear television despite the model quickly losing eyeballs to the on-demand services.

But Netflix is adapting — and Sarandos said that the results of the live events Netflix has conducted have made it so that the company will continue to be part of this space.

"And I just look at that and say well there's some real value in people gathering around the TV at the same time and doing that," Sarandos said. "It's a novel — it's not the way people watch most things — but it's something we don't want to not be a part of because it's happening on that television screen and people get very excited about it."

Netflix has been speculated to be the big player that could change sports streaming. The company has already signed a contract to air WWE Raw starting in 2025 — but Sarandos explained during an earnings call that WWE's scripted nature aligns with Netflix's sports storytelling strategy.

However, earlier this month, Netflix announced that it would be carrying the two-game slate of the NFL for Christmas this year, which is the company's first time to air official games for a major sport.

This has set of the idea that Netflix could challenge other tech giants like Amazon and Apple as well as other legacy sports broadcasters like Warner Bros. Discovery, Fox, and CBS for the sports throne.

Considering Prime Video and Peacock both saw huge subscriber growth from airing exclusive NFL games over the last several years, Netflix's decision to start airing the NFL could be a positive one.

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But the question remains whether the company will commit to a longer term broadcasting deal in live sports. They have reportedly been in talks for rights deals for the likes of the NBA and F1 over the last few years, but neither of those talks have led to anything.

It feels as though the small steps Netflix is taking to enter sports — "small" because the likes of Amazon and Apple signed billion-dollar deals for broadcasting rights years ago — are a sign that it's going to dive into the deep end for live sports fairly soon. But Parrot Analytics' Julia Alexander alluded to the idea in a report by Puck that it might be as big as those other giants.

Alexander, in a separate post on LinkedIn, referred to Netflix as the "NFL of its own domain" in that it is sitting on a perch that no one else can touch, so whatever Netflix decides to do with sports big or small, will send shockwaves to the entire media, television, and streaming industry.