Netflix stock slides trading at $230.44 as of 10:27 AM EDT. Instead of making more expensive outright purchases, the streaming business will pay around $200,000 in two-year licensing agreements; comedians will have to pay greater production fees.
According to The Wall Street Journal, Netflix (NASDAQ:NFLX) is changing the payment for comedy specials on its streaming platform and switching to a licensing arrangement in an effort to save expenses and place more responsibility on the comedians themselves.
The change would allow comedians more control over the material, the news source stated, citing persons with knowledge of the situation. In some circumstances, Netflix (NASDAQ:NFLX) is providing some comedians a two-year licensing arrangement worth about $200,000 as opposed to an earlier scene where it paid as much as $1 million in a single lump-sum payment.
The comedians would pay for the show’s production up front under the new agreement. However, when the deal expires, the comedians reclaim full ownership of the program and can use it to advertise their upcoming projects, according to the news source.
In response to the present market, a Netflix spokesman told The Journal that the new license procedure is “an extra, alternate option for comedians (at any point in their careers) to collaborate with Netflix.”
Netflix Stock Outlook
Netflix stock (NASDAQ:NFLX) fell 2% in Friday’s premarket trade. According to The Journal, Netflix (NASDAQ:NFLX) has already stated that it will invest around $17 billion in content for 2022 and will continue to do so in the ensuing years. Oppenheimer raised the price of Netflix stock (NASDAQ:NFLX) earlier this week, citing that the eventual introduction of an advertising-supported tier should spur membership growth and increase its average income per user. With the funding of numerous specials and the distribution of them to its audience of more than 220 million customers, Netflix has emerged as a significant platform for comedians.
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