Streaming Video and 'The Golden Age of Archive Licensing'

Recently, we had the chance to speak at the DMLA’s annual conference about the impact of Netflix and other streaming services on the footage business. Our presentation addressed three main questions. First, whether streaming video on demand (SVOD) services, taken collectively, now comprise the dominant customer base for footage licensors. Second, if the SVOD's are now the leading customers for footage, whether we can expect their standing to endure. And third, whether the streamers are adhering to long-established footage licensing conventions. In advance of our presentation, we spoke with a number of footage executives to get their first-hand perspectives on the evolution and status of this key market sector.

Based on those conversations, as well as other research and analysis, it does appear that the SVODs have become the leading client category for footage companies, that they will remain so for the foreseeable future and that, while Fair Use is on the rise, the streaming platforms are not driving this trend.

The Rise of the SVODs

It’s become axiomatic to say that streaming services like Netflix, Hulu, HBO Max, Disney, Apple and Amazon have changed the way most people consume movies, TV shows and short-form programming. Netflix alone boasts nearly a quarter billion paying subscribers worldwide, despite significant subscriber losses in the first half of 2022. To achieve and maintain this audience capture, SVODs are spending big to produce and acquire high-profile content of all kinds, including archive-based documentary programs.

It's projected that, collectively, the seven big players, including Disney+, Netflix, Warner Media/Discovery, Amazon, Apple, Paramount+/ViacomCBS and Peacock, will spend $50 billion on content by the end of 2022. That’s a huge number, so even if spending on archival-based documentaries accounts for only a tiny fraction of the total, it’s arguably enough to drive real revenue growth for the footage companies that license the archival content used in these programs.

And that was the consensus among the footage executives we interviewed. As one footage exec put it, “these days, either directly or indirectly, the streamers are the biggest clients, and have been a real boon to the archive industry. Of that there is no question. They almost single-handedly ushered in the golden age of archive licensing. Once they realized some doc series were getting more views than dramas they expanded fast into this area. ‘The Netflix Effect’ has been a boon for the archive world.”

Admittedly, we don’t have hard, primary data on the current strength of the SVODs as footage customers. For that, the most recent available resource is the ACSIL Global Survey of Stock Footage Companies 4 (AGS4), which was published in early 2019. The relevant takeaway from that research was that while the SVODs constituted a moderately important customer category, it was growing faster than any of the other key categories. And it should be noted that at the time the AGS4 report was published, Apple TV+, Disney+, Peacock, and Paramount+ had yet to launch. Jump ahead to 2022 and, based on all available indicators, it seems highly likely that, were this survey to be repeated today, SVOD services would outrank all other key markets sectors.  

Impact of Pandemic

But this is a tricky time to make any big projections about how trends in content production and consumption will play out over the next few years, given that we’re still emerging from a global pandemic that upended consumer behavior and viewing habits. There’s no doubt that all the major players, including broadcast networks, cable networks and streaming services turned to the archives as a way to fill their programming schedules during the pandemic, when original location-based production was significantly limited. And while this was a win for archives, the question is whether the interest in this kind of programming will endure now that we’re emerging from the pandemic and original scripted dramas are back in production.

As one source said, “I wouldn't say that found footage projects flourished necessarily as a popular trend, but really more as a necessity during those long months. We would all like to hope that the streamers now see them as a viable and popular programming option and will increase or maintain production in those types of programs. Hopefully that trend may stay with us for a while.”

Cautious Optimism

While nobody can say with certainty how production and consumption trends will play out over the next few years, there are reasons for cautious optimism about the staying power of unscripted programming in general, and archival docs in particular.

First, viewers have demonstrated an interest in good, juicy, multi-part stories, regardless of whether they are told as fiction, non-fiction or both. For example, the rise and fall of Elizabeth Holmes and Theranos is a great story, featuring a compelling, mysterious lead character, high stakes, a cast of bold-faced names and Silicon Valley setting. There was enough interest in this story to support a bestselling book, any number of podcasts, an HBO documentary and a Hulu dramatization starring Amanda Seyfried, for which she won an Emmy. In short, if the story is compelling and the production well executed, it will pull in an audience regardless of the storytelling form or platform.

Second, there seems to be no end to the interest in “True Crime” stories and celebrity bios. Highly localized stories with some broader human-interest angle appear to be of growing interest, and international stories are drawing audiences in US. A great example tying all these trends together is Neflix’s Vatican Girl, which tells the story of Emanuela Orlandi a teenage girl living with her family in Vatican City who mysteriously disappeared while returning home from a flute lesson on 22 June 1983.

Third, because of the sheer number of competing streaming service and the ease with which a particular service subscription can be canceled, the platforms need to create consistent buzz around new, splashy programs to keep viewers coming back, and they can’t depend exclusively on global hits like Stranger Things to meet that need. Non-fiction programming is fast and cheap to produce by comparison to scripted, star-driven dramas. The platforms also have unlimited shelf space, so can take a chance on shows that might be considered too niche for broadcast and cable networks.

Fourth, the SVODs, and especially Netflix, are really good at customizing their recommendations. So, once you’ve watched a few docs, you’re going to get more recommended, raising the visibility and popularity for these programs.

And last but not least, a quick look at the Top 10 programs on Netflix on any given day supports the theory that docs and unscripted shows and series are very popular. For example, as of this writing, Ancient Apocalypse, a series in which journalist Graham Hancock “travels the globe hunting for evidence of mysterious, lost civilizations dating back to the last Ice Age,” is the number two show in the US, just behind The Crown. Down to Earth with Zac Efron is number ten, and Killer Sally, Is That Black Enough for You?, Stutz, FIFA Uncovered and Unsolved Mysteries are all trending. Earlier this year, The Tinder Swindler became the first documentary to take the number one program slot on Netflix, a position it held for three consecutive weeks. And while the streamers typically do not share their viewing numbers, you can be sure that they can quantify the interest in and value of a program at a very granular level. So, if they are continuing to invest in a particular kind of programming, we can be pretty sure that it is working for them.  

Playing by the Rules

As for the last question regarding the streamers’ adherence to long-standing licensing conventions, our findings were less conclusive. Pretty much all of the execs we spoke to felt that Fair Use was on the rise, but did not think the SVODs were making particularly egregious use of the practice. As one exec put it, “regarding the usage of unauthorized outsourced footage, this is also a relatively new reality. There is more info out there on the public domain, more producers are studying and applying the fair usage guidelines and there is as well a general lack of knowledge in the new age of researchers as to what they can freely use and what they cannot.  YouTube and Internet Archive are largely to blame. So as more researchers and producers learn about ‘free’ sources this trend will continue.”

“I do find however,” he continued, “that most producers still want a signed license agreement that gives them protection and indemnification. This is what saves the stock footage houses that offer PD stuff. When producers sign for their E&O insurance on their program or series, they need to outline every clip and its source, so they have to be certain that the footage they are acquiring from unlicensed sources is actually OK to use.”

As another footage exec put it, “I don't know that we've seen any clear changes in licensing behavior by/for the big streamers, except that we are seeing a definite increase in the number of custom license agreement requests.  The legal teams for the streamers all want customizations that, predictably, pivot less liability on them and more on the licensor. We reject many of their specific customization requests, and acquiesce where we can.  Thus far, we've always been able to come up with mutually-acceptable, customized versions so the licensing can go forward.”

Stay Tuned

As the pandemic fades and life returns to something resembling normalcy, we can all hope that the “Golden Age of Archive Licensing” endures and is broadly enjoyed across our industry. We’ll be keeping a close eye on these trends as they unfold. And, as we learn more, we hope to gain greater clarity as to whether the streamers are a force for good in our community. As always, your feedback is welcome. Please email me at davidwseevers@gmail.com with any questions or concerns.