Wednesday, January 17, 2018

Letterman On Netflix | Lefsetz Letter

It wasn’t great.

Beware the disinformation campaign. HBO is very afraid. It’s why Murdoch sold 21st Century Fox. Netflix is so far ahead of the game, with a strategy no one else employs, that not only will they continue to win, but they’ll dominate in the future.

You do this by spending. Anathema to every company disrupted by the internet. They all tried to maintain their margins, by laying people off, by decreasing production, and in the process they marginalized themselves. When it comes to art, success is hard to predict, which is why you must be in the marketplace constantly. Which is why the record companies are almost as stupid as the book publishing companies. The publishers neutered electronic distribution to their detriment. They think they’ve won by raising prices and keeping physical books healthy. They’ve only postponed the great fall-off in the future, like Kodak, which never did have a workable digital strategy. Amazon was building a whole new business, based on mass distribution at a lower price, eliminating a plethora of costs, but the publishers thought their price point was inviolate, like the music business. I laugh at the rewriting of history, all the hosannas for the iTunes Store. Musicians HATED IT! It disintermediated the album and barely put a dent in piracy, if at all. Whereas once we went to streaming at one low price of $10 a month people hoovered the offer up, Spotify has 70 million subscribers, it doesn’t pay to steal.

And now everybody puts their wares on streaming services and the labels cherry-pick the best and overlabor the production and the marketing thereof and think they’re winning?

No, now is when the majors should be spending, exploring new avenues, doubling-down on what they did in the seventies, when they signed a plethora of new acts and nurtured them. There were left field successes, and not everything worked, but a healthy business was built. The biggest act in the world is Adele, but not a single label is trying to replicate this formula, finding a great singer with singable material with melody, they’re all too busy chasing hip-hop tracks. But just a few of them with heinous deals. So now acts are going totally independent and the output of the majors is minimal, kinda like HBO and the movie studios.

Forget all the hoopla about there being too much TV. They’re fighting for a distant destination, who will win in the end. Of course there’s too much to watch now, but it won’t be this way forever, just like there are four tech companies that dominate today, there will be a small number of TV/outlets in the future, and they’ll dominate.

And Netflix and Amazon have a leg up because they’re SPENDING!

Amazon is late to market, but it’s got the power of Prime.

Netflix has first-mover advantage and it continues to innovate.

Traditional TV was so busy maintaining its traditional model that it missed the memo. Credit Jim Dolan, the New York City whipping boy, how smart is he? He blew out Cablevision before the crash. Channels are gonna drop like flies. Is anybody preparing for this?

Of course not.

Hulu was a bunt. Do I watch commercials or pay or what? Who can even understand the offer?

But at least they have a hit, “Handmaid’s Tale” was the best thing that ever happened to the service.

But Netflix has many more, from “Narcos” to “Stranger Things” to reboots of “Full House” and “One Day At A Time.” As for the failures, YOU FORGET ABOUT THEM!!!

Now Netflix is not a place to go to see old movies, its thrill is new production. HBO and Showtime and Starz and Cinemax think their ace in the hole is the airing of films. But we’re gonna go day and date and where’s that gonna leave them? Furthermore, Netflix is making movies! Hell, “Mudbound” not only got a ton of positive press, you can watch it every damn day on Netflix, you don’t have to go to the theatre or remember as it works its way through distribution channels in the future. Distribution coinciding with publicity, WHAT A CONCEPT!

You can only eclipse the frontrunner if it stumbles and you have a better product. Netflix ain’t stumbling and is Disney willing to markedly increase production, losing tons of dough, to make a run against it? OF COURSE NOT! IT WOULD HURT THE STOCK! They don’t realize they’re in a run for their life, they need to re-educate Wall Street, but that’s not where their head is at.

As for HBO… They just don’t have enough product. And too much of it fails. Remember “John from Cincinnati”? And there’s no buzz on “Divorce,” not from the first season anyway.

Which brings us to the curious case of David Letterman.

The dirty little secret is you learn as you go along. The first episode won’t be as great as the tenth. They stunted with Obama, but they blew their chance. Because Obama ain’t gonna be good entertainment, he’s too guarded.


For those oblivious, David Letterman, along with his old girlfriend Merrill Markoe, reinvented the late night format. It used to be serious with a little comedy, they flipped the script, and brought in shenanigans. And just when everybody’s doing it his way, he’s now doing it THE OLD WAY!

Letterman’s show is serious. A lengthy interview not based on the guest delivering pre-screened jokes. He actually digs deep. And all that time in front of the camera has served him well, he’s actually gotten good at it.

But it’s the asides, the conversational responses that wow you. Letterman has an incredibly sharp wit, his comebacks will have you reeling.

But the highlight is when they go to the tape, outside the theatre, the package and interview with John Lewis is spectacular, what Vice News does but with more gravitas. Meanwhile, Dave does not wear a suit, he’s in his street clothes in Alabama, and this normalizes the whole thing. This isn’t shot for them, but US!

If Letterman was not famous, few would watch this.

But he is. And Netflix gave him so much money and such a commitment that he’ll get better. More of these news interludes, more wit and interaction. Will it ever be great?

I’m not sure, but I’m gonna watch and see.

After I pull up the episodes of Seinfeld’s “Comedians In Cars Getting Coffee” that I missed. I watched Bob Einstein, never could manage to get to Crackle, or wherever Jerry used to be, but now that the archive is on Netflix…

You want to be on Netflix. Forget HBO’s b.s. about getting lost in the shuffle. Every time you log on to Netflix you get suggestions, you see where you were, HBO is a lame twentieth century outlet that you’re supposed to sit down and watch as it plays out, WHO DOES THAT? As for the app… There’s not enough new stuff you haven’t seen, so you go to see what you remember, you’re not just checking it out on the by and by.

Like you are with Netflix.

We want it all and we want it now. I ain’t gonna wait for a series to play out over weeks. If I fall behind I just give up, this has happened multiple times with HBO, even with their vaunted show “Big Little Lies.”

But when it comes to Netflix the entire series is lying in wait for when I’m ready. It remembers where I left off. And viewers are members of a secret club who love to discuss and exchange ideas. More people have e-mailed me about “Black Mirror” than any show on television. This is where hits are made, socially, not via mass market promotion.

Not everything works, but who woulda thought “The Keepers” would be such riveting television? Netflix is taking chances. It’s risking. It’s pushing the envelope.

Now that’s truly American.

And it’s exactly what we want.


“HBO to Talent: You Won’t Get This Much Love at Netflix”

This is publicity in the financial paper of record to try and spin a story, no different from politics. All the comedians jumped to Netflix, so HBO says stay home where nobody is for more notice. Which is kinda like staying on the indie when the majors offer you a better deal. Well, back before the internet blew up the music business anyway. When the big boys pay attention to the upstarts and gear up their publicity machine you know something is happening. Never forget to read between the lines.


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