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'The Office' is leaving Netflix, but concerns that its exit could hurt subscriber growth ignore the big picture

Ashley Rodriguez   

'The Office' is leaving Netflix, but concerns that its exit could hurt subscriber growth ignore the big picture
Entertainment3 min read

the office

NBC

  • "The Office" is leaving Netflix in 2021 for NBC's soon-to-launch streaming service.
  • NBC is the latest major media company to pull popular programming for Netflix, which has prompted debate over whether the streaming giant can continue to grow its subscriber base meaningfully without the back catalog the service was built on.
  • The concerns are more acute in the US than anywhere else in the world.
  • Demand for "The Office," for example, drops sharply outside of the US, data on a per capita basis from Parrot Analytics shows.
  • Click here for more BI Prime stories.

In the words of Michael Scott: "It's happening! Everybody stay calm."

The US version of "The Office" will be leaving Netflix in the US in early 2021, after about a decade on the streaming-video service.

NBC outbid Netflix to stream the TV sitcom - produced by NBCUniversal's Universal TV - on its own streaming service, which launches next year. NBC is paying $100 million per year for five years for the domestic rights, CNBC reported. Netflix offered $90 million a year.

NBCUniversal is the latest major media company to pull its popular programming from Netflix in the US. Disney also ended a deal to stream its new movies on Netflix, electing to put them on its Disney Plus service when it debuts instead.

Read more: A Warner Bros. exec explains the data behind licensing shows like 'Friends' to Netflix

The deals have prompted debate on Wall Street and in the media community over whether Netflix will be able to continuing growing its subscriber base meaningfully without the back catalog of content from third-party studios that the service was built on.

But, as "The Office" demonstrates, those concerns seem to be more acute in the US than anywhere else in the world.

"The Office" is most "in-demand" among audiences in the US, per capita data from Parrot Analytics shows. Internationally, audience demand for "The Office" drops steeply.

Canada, which had the second-most audience demand for "The Office," had about half the demand of the US. In Ireland, the 5th top market for the series, there was one-third of the demand that was measured in the US.

the office demand

Ashley Rodriguez/Business Insider

The data is based on "demand expressions," a standardized metric from Parrot Analytics that reflects audience demand by measuring and weighting things like viewership, social media comments, and file sharing.

In the US, "The Office" was the 3rd most in-demand TV comedy from the last 12 months, behind "Saturday Night Live" and "Brooklyn Nine-Nine," and ahead of "The Big Bang Theory" and "Friends."

But in Brazil, a key market for streaming-video services, "The Office" was the 14th most in-demand comedy. It was the 17th most in-demand comedy in, India, another major market.

Netflix already doesn't have the rights to "The Office" in many other parts of the world. "The Office" streams on Amazon Prime Video in the UK, Brazil, and India, for example.

NBC has not detailed the global rollout plan for its upcoming streaming service, but said the platform will be available in major international markets. It has not said whether it will pursue the rights to "The Office" in other markets, too.

Back catalogs of popular movies and TV shows like "The Office" are still useful ways to keep people engaged on Netflix in between new releases and returning shows, anywhere in the world.

But it may not make sense for Netflix to spend lavishly on the US rights to an old TV show, when its biggest prospects for growth are abroad. Netflix has been focusing on original series with international appeal, like "Stranger Things," "Dark," "Elite," and "Sacred Games."

While the US is still Netflix's biggest single market, it's growing the fastest internationally in places like India. About 7.9 million, or 80%, of Netflix's net paid subscriber additions during the first quarter were international, the company reported. International subscribers make up the largest share of Netflix's member base, with 88.6 million paid members compared to 60.2 million in the US.

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