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CBS using Star Trek Discovery to destroy Netflix?

By Rich Libero

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Ian Morris of Forbes.com posts an interesting review of how CBS could be using Star Trek Discovery as a plot for Netflix destruction.

If CBS truly is truly planning a Netflix destruction, we can relate it to the strategy deployed in the TNG episode “I Borg.” In the episode, a captured Borg develops individuality through interaction with the crew. As the Borg learns, he’s given the name “Hugh.” Captain Picard, faced with a ethical dilemma, opts to return Hugh to the Collective.

Hugh’s return to the Collective spawns a cascade effect inside the group causing all Borg to achieve a confused and self-serving form of individuality. Ultimately, the new thought process nearly destroys the Borg and spawns two TNG Season 6 episodes in Descent I and II.

In the Forbes article, Morris reveals how CBS managed to cover Discovery’s production costs by licensing the series to Netflix. He speculates CBS might provide this to Netflix for a season just to get their service up and running and before pulling the rug out.

In Sept. 20, 2016, article in Variety, CBS chair Leslie Moonves confirmed how Netflix’ licensing fees helped cover the reported $8 million per episode production costs.

According to Variety:

“Moonves cited the deal CBS recently struck with Netflix for rights outside of North America to the entire “Star Trek” canon, including the new series coming next spring to CBS’ competing CBS All Access SVOD services. The price Netflix paid for the new “Star Trek: Discovery” series (sight unseen as the show went straight to series) will cover the show’s production costs.”

CBS simultaneously licensing Discovery while using it as a means to promote CBS All-Access ranks as a stroke of genius. Forget about Netflix destruction as a plot, CBS pulled off a great business deal.

To further grab a Moonves quote from that same Variety piece, he points out: “We’re big fans of Netflix. We don’t think they’re eating the world or trying to put us out of business. … They’ve made the entire world much more competitive and driven up the price of premium content a great deal.”

Traditional aka mainstream media (MSM) continues to struggle. However, the combination of a drive for consumer attention and the pioneer phase of “over-the-top” (OTT) streaming services creates a bull market for content rights. Companies are in acquisition mode as they grab brands and relationships to bolster their portfolios, crush opponents and have a place when the inevitable consolidation stage kicks in (it always does).

Trek/CBS role in the modern media world

CBS is unique among the shrinking number of media companies in that it does not own a cable or satellite provider. The company relies on its networks to gain carriage on those providers while building its media brands. Additionally, it creates TV shows and films and licenses them to competitors in the industry. It’s an odd world.

But the advent of OTT basically provides any mom-and-pop with the means to become a media distribution company. CBS All-Access is a must for CBS because they need a place to eventually present all their content offerings. However, with brands as powerful as Star Trek, they could spin off an entire Trek-only sub-package and do quite well.

Is Netflix the enemy?

Netflix is certainly not an enemy to the consumer. But they disrupt the traditional MSM model and for that they must tamed. By tamed, consider the MSM really wants vassal states or to state more plainly, a company that licenses their old, stale, uninteresting content while preserving the choice bits for themselves.

The Achilles Heel for Netflix resides in the fact they can either license or produce their own content– both are expensive vulnerabilities. In the end, Netflix may evolve into a pure production house — they are practically there now (and that will impact the cinema business more than TV).

Watch out for Disney

If any company can be accused of plotting the Netflix destruction, Disney recently purchased a controlling stake in BAMTech, the spinoff company of Major League Baseball Advanced Media. BAMTech is the Cadillac of streaming services and providers. MLBAM built a huge and robust system with complete foresight of live streaming’s current role.

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Disney’s plan with BAMTech is to create Disney streaming services that will effectively take everything they produce — the crown jewels being Marvel content and Star Wars — and horde them for themselves. Maybe they’ll throw Netflix some expensive crumbs, but Disney is about to become a monster player in the OTT business.

Going back to the Trek OTT channel, imagine if Disney breaks it off for all their Marvel content or Star Wars. Insane!

Would you subscribe to an OTT or streaming service that was 24/7 Trek?

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