By Taylor Durham
In 2017, 74% of Black TV viewers reported they stream some of their TV content
Netflix recently announced it burned $3B in cash in 2018
Netflix (NFLX +1.04%) has been burning through cash to produce and distribute original content, with the hiring of a former ABC executive this might give insight into the company’s long-term objectives. The streaming giant has tapped Channing Dungey as a vice president for its original content offerings in hopes of wading deeper into diverse audiences.
Why This Matters: Dungey is the third high-profile person to be poached from Disney (DIS -1.57%) owned ABC, a favorite target for the streaming giant in terms of content creators. The move reunites her with former ABC showrunners Shonda Rhimes and Kenya Barris. Dungey’s credentials are impressive as she brought diverse talent to cable television by greenlighting shows such as Black-ish, Scandal, and How to Get Away with Murder.
The addition of Dungey will only help to diversify the company’s executive leadership and provide a seat at the table for black content creators. Last year, they also hired Vernā Myers for a brand new role as Vice President of Inclusion Strategy, as the company looks to align their internal priorities with content initiatives. Additionally, the streaming leader has been raking up multi-million dollar deals with black content creators including the Obamas, Barris and Rhimes, the latter under her Shondaland imprint.
Netflix recently announced it burned $3 billion in cash in 2018 and expects to do so again in 2019, in an effort to grab more subscribers. In total, Netflix has about $10 billion in debt but the momentum of customer growth and rising prices has set itself apart from other streaming companies like Hulu and Amazon (AMZN +2.47%), effectively securing its place as the premiere streaming platform. The hiring of top-tier talent signals that Netflix is trying to sail in the right direction, starting with black viewers.
A report from Horowitz Research found black audiences are also content trendsetters, with 58% reporting they want to be the first to know about new content and are more likely to watch shows that reflects their experiences. Facts like these explain why Netflix has made Black content and talent a focal point of its original programming initiatives.
Situational Awareness: The streaming giant has a ways to go to get completely right internally and with black viewers. Netflix was accused of falsely marketing content that features black actors in secondary roles as lead characters. Oddly enough, the company has stated they don’t collect personal data for marketing purposes. Internally Netflix is also battling an ongoing fallout after a former executive used racial slurs multiple times in office settings.
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