YouTube Hands the Best Acquisition Oscar to Netflix
Say 'UGC' again. Say. 'UGC'. Again! I dare you! I double-dare you!
It sure looks like Google may have just handed Warner Bros to Netflix on a silver platter. Yes, Google. Why? Because YouTube just stole The Oscars from ABC.1
On the surface, this may not seem like a big deal. Award shows are silly and famously in decline. That includes the biggest and most famous of them in The Academy Awards. Viewership peaked at 57M in 1998, and while it has bounced back a bit from the pandemic lows, last year saw 20M viewers watch the show. Top creators on YouTube get more viewership than that on a regular basis.
And that's sort of the point. The world has changed. And there's no going back. It's not just that streaming won, it's that the internet won.
And that is especially top of mind at the moment because Netflix has a deal to buy Warner Bros for $83B. But many people, most notably David Ellison, are sure that the deal won't be approved by regulators because Netflix is the top streaming service. And they'd be buying not only the top movie studio (this year), but also the third largest streaming service in HBO Max. It's the stuff antitrust dreams are made of, right?
Well, no. It's far more complicated than that because again, the internet. Yes, Netflix may be the winner in "streaming" but what does that even mean? A service that streams television and movie content I guess. But why exactly aren't we including YouTube – or Instagram, or TikTok, for that matter – in that bucket? Because it's user-generated content? The three scarlet letters of Hollywood. UGC.
Please.
What matters should be the same thing that mattered in the Meta antitrust trial, which saw the "social network" wipe the floor with the FTC's arguments. Why? Because it's 2025 and the legal system isn't stupid. Meta doesn't just compete with MeWe – in fact, I'm not entirely sure they compete with MeWe at all, because I still haven't met anyone who knows what MeWe is (besides clearly the FTC) – they compete with Snap, and TikTok, and yes, YouTube.
It's all about attention. Eyeballs. It's true with Meta, it's true with Netflix. And this YouTube/Oscars deal just drove that home. Just in case the Justice Department needs a data point, The New York Times has a good one in their story on the deal:
YouTube has long been a dominant force on mobile devices and laptops, but it was only in the last few years that it began dominating actual television sets, too. YouTube commands 13 percent of all television viewing time in the United States, the biggest share of any streaming service, according to Nielsen, the ratings firm. (To compare, Netflix stands at 8 percent.)
Wait, YouTube is a streaming service? What?!
There is a war out there. But it's not between the "streamers". Or even the movie studios. Those wars are over. Netflix and Disney won, respectively. The new war is for the next phase of entertainment. Right now, YouTube is winning. And this deal for the Oscars, while small relatively speaking, points to their clear intentions – as does this recent profile of CEO Neal Mohan by The Hollywood Reporter. You know, the one entitled, "YouTube Just Ate TV. It’s Only Getting Started."
That cover story hit a couple months before this deal, quoting YouTube's intent to become "the most powerful platform on earth". So yeah, I think Netflix is going to be allowed to buy Warner Bros. In fact, it feels like they might need to in order to have any shot against YouTube.
As I wrote back in October on the news that Netflix was trying to take video podcasts away from YouTube:
This is a competition for literal eyeballs. And YouTube dominates them in all these verticals. Oddly not in "premium" content where Netflix dominates, but it only feels like a matter of time until they're back competing in that world too, especially as they keep expanding YouTube Premium. Remember when Cobra Kai launched as a YouTube original only to be handed on a silver platter to Netflix? Yeah, they're gonna want another shot at this at some point. It's Google! Initiatives are cancelled only to be rebooted only to be cancelled only to be rebooted...
The fact that as a part of this deal, Netflix is requiring that the videos not be posted to YouTube in full – i.e. only clips for promotional purposes – says all you need to know here. While Spotify can't compete with YouTube in video, Netflix can and will.
UGC, movies, television, it's all going to be thrown into a blender in the next decade. What comes out will terrify Hollywood. But they were terrified when "talkies" came about. Then color. Then television. Then videotape. The plot is always the same, as is the ending. It's not the death of movies, or television, it's the expansion of it. An opening of the aperture to a far larger audience. Hollywood is scared because it's not the same captured audience watching via the same controlled means of distribution. But again, that's not new. The same thing keeps happening over and over and over again.
You're scared of Netflix? Netflix is your guide through this! Just wait until AI really matures as a technology. It has only been three years since OpenAI's DALL-E was released. Look at where we are now with image generation. Look at Sora or Veo. Now close your eyes and think about where we'll be in three years.
Disney gets it – or at least is trying to. Everyone else is dreaming about a return to 1950. Or at the very least, 1998, when Titanic and DVDs ruled supreme. Wake up, Hollywood. And get ready for a five-hour Oscar stream. Because guess what, on the internet, no one can hear you scream about how long a telecast may be. No one cares. The next bit is just a click away. So you better be entertaining. Or else.
Iceberg! Right ahead!
M.G. Siegler
M.G. Siegler
M.G. Siegler
M.G. Siegler
M.G. Siegler
1 A move which wasn't entirely out of the blue, by the way. Lucas Shaw of Bloomberg reported on this possibility back in August. Still, surprising! And who else was in the running for the rights? Netflix, naturally. ↩