Netflix is spending $6 billion a year on content, choking basic cable and brusquely rattling the relationship business of the town as fears of a Google- or Apple-sized dominance send a chill down the entertainment industry’s spine.
Studios and cable channels fret that the company, with its 83 million global subscribers, is sucking up so many eyeballs and bidding up prices for programming so high that they won’t be able to compete. And agents worry that as Netflix elbows out competing buyers, the company’s growing insistence on buying up all rights to its original programming around the world will do away with the profit participations that on breakout shows (such as Modern Family) provide steady income in an unsteady industry.
“We love the money and we can still grow our clients [by getting them Netflix deals],” says one agent. “But I’m worried about the long term. If backends go away, what’s the future? This is why CAA and WME have diversified.”
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