Netflix Eyes IP Deals Rather Than “Stressed” M&A Assets

from Deadline

Netflix is often mentioned as an M&A player when a studio or media group is up for sale, but don’t expect the streamer to buy a major Hollywood business any time soon.

Co-CEO Ted Sarandos, speaking on the company’s second quarter earnings call, said that he’s more interested in buying IP.

“We’ve always looked at these things in terms of the opportunity of IP, versus those assets, some of those assets are stressed for a reason,” he said. “When we would look into our M&A activity, it would be mostly around IP that we can develop into great content for our members, which is our real strength and business. We have traditionally been very strong builders over buyers and that really hasn’t fundamentally changed. But if there are opportunities that give us access to pools of IP that we can develop into and against, that could be super interesting.”

Over the years, other than a handful of small animation businesses and VFX studios, the company has focused on acquiring the likes of Jupiter’s Legacy producer Millarworld, in 2017, StoryBots in 2019, and The Roald Dahl Story Company in 2021.

“We think we’re taking the right course in terms of offering the content to our members and having it around even after its original run on Netflix. The syndication market, the home video markets that continue to exist today are kind of contracting in a way that isn’t too exciting to build up against, versus this opportunity we have to please our members and fill our members with our content all the way back through the history of our content,” he added.

Sarandos added that when sequels and spinoffs launch, it helps drive eyeballs back to previous seasons and films. He highlighted the example of Queen Charlotte driving viewers back to the first two seasons of Bridgerton and the fact that Extraction appeared in its top ten list when the sequel was released.

“It’s a very fluid and dynamic offering in that way and even better, the deeper and richer that library becomes,” he said.

This comes as Netflix has started acquiring syndicated content from its rivals such as Insecure from HBO, as first revealed by Deadline.