Talent agencies are arguing that creators of popular Netflix series should receive a cut of the advertising profits now that the streaming giant has changed its financial model.
In an interview with the Financial Times, United Talent Agency CEO Jeremy Zimmer argued that Netflix has “changed all the rules” with the recent introduction of its ad-supported tier, and therefore the payment terms for creators should also change.
“A show that does really well will get more advertisers and more revenue will flow to Netflix,” Zimmer explained.
“Therefore, our clients who created that show should be compensated for that additional revenue.”
Such deals, known as “back end” payments, are common in Hollywood, where a studio will take a gamble by paying an untested creator less up front with the majority of their earnings coming from box office receipts.
Considering Netflix famously keeps its streaming figures under wraps, it has only offered entirely upfront payments to creators – regardless of how the content fares once it is released.
According to the FT, Netflix has had to refund a number of advertisers recently after their ads failed to reach the promised audience numbers through the ad-supported tier.