How Netflix Measures A Show's Success

The U.K. - like many European countries - is concerned with ensuring that local television and movie productions continue as large multinational media companies come in and snap up local production facilities. In the case of Netflix, aside from the company's success in the U.K.'s streaming services battle, it has recently made a deal to open up a massive 450,000 square foot, 14 soundstage production facility at the historic Shepperton Studios.

The House of Lords Communications Committee held a series of hearings in July that examined the impact of Netflix and other streaming giants on local U.K. television production and sought assurances that international streaming services would continue to produce and purchase local projects.

As part of the hearing, Netflix sent a letter to the committee clarifying how it measures a successful show.

In the letter, Netflix states it tracks three parameters about the shows and movies available on the service:

Starters – the number of households that watch two minutes of a film or one episode of series

Completers – the number of homes that watch 90% of a film or complete season of a show

Watchers – the number of households that watch 70% of a film or single episode of a series.

Each parameter is given for the first seven days the item is available on Netflix, and for the initial 28 days.

Netflix said content creators are given the Starters and Completers data and sometimes given the Watchers numbers. But it also revealed that it uses the Watchers data on those rare occasions it reports on viewing performance. For example, when Netflix says that 40 million people watched the latest season of "Stranger Things," it means that 40 million people watched 70% or more of single episode.

Ted Sarandos, Head of Content for Netflix, said the letter that the company plans to keep content creators better informed on the performance of their shows and movies:

"I think it’s important for artists to understand, to have the audience also understand the size of the reach of their work. So that’s why you’ll see us ramping up a little bit more and more and giving out — sharing a little more of that information."