- Netflix has increasingly looked to license YouTube content, and it seems to be paying off.
- “Ms. Rachel” recently debuted on Netflix’s list of top 10 shows globally.
- Creator content licensing among streamers has often focused on kids’ shows but could expand.
So, what’s the difference between a YouTube children’s show and a Netflix one?
That question has become increasingly difficult to answer in recent months and may be a sign of things to come in other genres.
Netflix’s latest creator pact — a four-episode run with YouTube educator Ms. Rachel — looks like an early success, debuting in fifth place on its list of top 10 shows globally with 4 million views. The episodes feature compilations of Ms. Rachel’s vast YouTube library.
For years, streamers were hesitant to acquire creator-led shows, said Eyal Baumel, a partner at digital network Yoola, which works with kidfluencers like Like Nastya and Salish Matter.
But Baumel said streamers began to realize that licensing YouTube content could be an inexpensive way to snag shows that came with a built-in audience. Baumel called the success of Netflix’s 2020 licensing deal with Cocomelon “a major turning point” that opened the door for future deals. (In addition to Cocomelon, Netflix syndicates content from other hit Moonbug properties like Blippi and Little Baby Bum.)
Netflix co-CEO Ted Sarandos recently contrasted YouTube fare with the “premium content” that’s Netflix’s specialty. But in some categories — whimsical kids’ content, for example — those lines look a lot less clear.
Netflix declined to comment.
Netflix isn’t the only streamer interested in licensing creator content. Baumel said Roku was an early and prolific licensor of creator-led kids’ shows.
“Nastya is massive on Roku,” he said.
Other streamers that have moved into this space include Hulu, Peacock, and Amazon Kids+.
“The formats of TV are beginning to meld,” said Evan Shapiro, a media industry analyst. “More creator stuff is on big platforms because it’s working, it’s cheap, and you can move the audience around. Users are watching creator-led stuff on TV now.”
Streamers are ramping up, but there still could be room to grow
Pocket.watch works with YouTube whizzes like Ryan’s World and Love, Diana, and as part of its business, licenses their catalogs to streamers in the form of half-hour episodes.
It started working with Hulu in 2018 and now distributes on 43 streamers in 81 countries.
Pocket.watch SVP and GM of channels, David Williams, said that licensing deals vary in structure — from fixed fee to revenue sharing and other performance-related elements.
Williams said the company vets and optimizes YouTube content for streamers, where parents sometimes feel safer letting their kids watch because the content is curated.
A sign that interest is ratcheting up? Hulu, Peacock, and Amazon Kids+ just expanded their Pocket.watch slates.
“With Hulu, we’ve done a series of renewals where essentially our number of titles doubled every time,” Williams said.
Williams said he felt there was still room to grow, however.
“We’ve been pushing the boulder up the hill, and there’s been a lot of progress, but it doesn’t feel quite like a revolution at this point,” Williams said.
YouTube licensing could continue to move beyond kids
Though kids’ content is the clearest category, it’s not the only social-media fare streamers are interested in licensing. In September, Netflix picked up “The Amazing Digital Circus,” a dark animated comedy born on YouTube.
Neil Waller, co-CEO of creator talent firm Whalar Group, said studios and streamers are looking at content in many categories, including comedy, horror, food, and travel. He added that they’d generally been interested in shorter-format, episodic shows.
Netflix is also taking a hard look at video podcasts.
In a big change in the past year, Waller said, the media companies’ C-suiters are often coming to the meetings — a sign they’re taking the space more seriously.
Down the road, it’s not hard to imagine a studio or streamer building products or even experiences around creators.
“It’s an obvious next place to go,” Waller said. “These companies have the experience in making worlds around IP. They also have the distribution relationships. It’s a lot of experience that can be brought to the table.”
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