Netflix May Turn the Clock Back to Old-School Live TV — Here’s Why

Netflix could soon pivot to offering always-on “live TV” channels — a move that would see it entering territory that’s traditionally been the domain of services like Pluto TV and Tubi — as it looks for new ways to combat flagging subscriber engagement.

According to The Wall Street Journal (Apple News+), while the streaming giant is enjoying rising profits and a steady customer base, its executives have been discussing concerns about low viewer satisfaction.

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It turns out that while people are keeping their Netflix subscriptions, many may be doing so simply out of habit. “Engagement,” which is an industry measure of how long people spend watching a movie or TV show — and how likely they are to finish it — is apparently on the decline.

A potential solution reportedly being discussed around Netflix’s boardroom table is “adding live channels that would continuously stream certain programs, or shows and films from a certain genre,” the WSJ notes. The company not only believes this could help draw more people in, but also generate more ad revenue. That’s become something of a golden goose for the streamer as ad-free customers find themselves facing steep price hikes to make up for the piles of cash Netflix makes from its more affordable ad-supported subscriptions.

There’s also reportedly been talk of Netflix offering streaming bundles, although it sounds like these would take the form of “channels” offered through the Netflix app, similar to what Amazon and Apple are already doing, rather than packages where Netflix is tied in with services like Peacock for an up-front monthly cost.

Netflix’s ‘Second Season Conundrum’

This latest news follows a report earlier this week from Bloomberg’s Lucas Shaw that says Netflix is having a “second season conundrum,” struggling to get folks to stick around for any of its shows beyond their first seasons:

While first seasons of shows have generally performed better on streaming services like Netflix than they do on traditional broadcast networks, where they often rely on word of mouth instead of marketing campaigns and “suggested for you” promotions on app home screens, this is still an unprecedented drop that’s creating “a major source of concern” for Netflix, Shaw says — and the WSJ concurs, noting that it’s putting serious downward pressure on its bottom line:

Anyone who has followed the progression of any streaming series shouldn’t be too surprised that engagement is a problem. We’ve entered an era where shows aren’t even guaranteed to get a second season, and when they do, it often takes years to show up.

Apple TV isn’t immune to this problem, but it manages to draw users back to its biggest hits thanks to its quality-over-quantity approach. There’s little doubt that anyone has given up on Severance, Silo, or Pluribus, all of which have left us on the edges of our seats. Even Ted Lasso, which wrapped up a satisfying three-season arc in 2023, will likely bring in record viewers for its Season 4 comeback on August 5.

Unfortunately, Netflix Originals have become a volume business, with the streaming giant often feeling like it’s throwing ideas at the wall just to see what sticks. That’s not to say some of its shows aren’t moderately engaging, but they don’t really lock people in, and it’s much harder for a middling show to keep the momentum when people binge shows in a few days and are then forced to wait months or even years for more.

Trapped Inside the Netflix Silo

Meanwhile, as Netflix executives wring their collective hands over engagement, the company’s hegemonic desire to remain in control keeps it from partnering with companies and services that could open up new pathways for customers — most notably Apple’s TV app.

While Apple and Netflix signed a rare F1 partnership earlier this year, that was a case of sports rights making for strange bedfellows. Apple now has exclusive F1 streaming rights in the US, while Netflix hosts the popular Drive to Survive documentary series. There’s obviously a natural synergy between the two, so a tit-for-tat deal that gave Apple fans access to some tie-in F1 content in exchange for letting Netflix stream the 2026 Canadian Grand Prix in May made a lot of sense.

However, this likely wasn’t a sign of any real softening of Netflix’s position. The streaming giant has been the lone holdout on integrating with the Apple TV app for years — and there’s no sign that’s about to change.

For folks like me who are firmly entrenched in the Apple ecosystem, Netflix becomes its own little silo on my Apple TV set-top box. If I want to find or continue watching something on Prime Video, Disney+, or just any other streaming service, I can find it all in one place — the same app that shows me Silo and Shrinking. If I want to watch Netflix content, I have to open the Netflix app. That extra friction point is just enough to make me more likely to just watch something that’s already in my primary app.

I find myself in full agreement with 9to5Mac’s Zac Hall: “if engagement is an issue, surfacing Netflix content outside of the Netflix app, like in the TV app, sounds like a great place to start.” Netflix’s intransigence on this issue may not be its ultimate undoing, but it’s certainly not helping.