If you've never watched "Suits," you're missing out. This legal drama, which aired from 2011 to 2019, may not have received exceptional critical acclaim during its initial run. However, it has recently become a streaming sensation, dominating the summer charts on Netflix.
Surpassing its competitors by nearly three times in minutes watched, "Suits" has held the top spot for six consecutive weeks. The show's unexpected success has been a major win for Netflix (NFLX), as it continues to captivate audiences.
Interestingly, "Suits" was already available for streaming on both Amazon Prime Video and Peacock before finding its way to Netflix. Alan Gould, an analyst from Loop Capital, attributes the show's popularity surge on Netflix to the platform's user-friendly interface and extensive network. Despite not being an original or exclusive series, "Suits" has proven itself to be a valuable addition to the streaming giant's lineup.
The triumph of "Suits" and other older shows like "Grey's Anatomy" and "NCIS" highlights the advantage that pure streamers like Netflix have over those who rely on cable channels or TV stations. These platforms can rely on beloved reruns to maintain viewership, while cable and TV station owners constantly seek fresh and engaging content.
Unfortunately, the industry may be stuck with recycled television for a while. Richard Greenfield, an analyst from LightShed Partners, suggests that the ongoing strike between writers, actors, and studios may not end until early 2024 at the soonest. The deadlock arises from disagreements over compensation for successful shows and films, defining what constitutes success, and the incorporation of artificial intelligence in script and movie production. With each passing day without an agreement, the industry suffers further damage.
As the streaming landscape continues to evolve, "Suits" stands as a testament to Netflix's ability to turn older shows into modern-day sensations. Its success signifies that streamers like Netflix may not be pressured into unfavorable deals, unlike their counterparts with cable channels or TV stations. With the strike prolonging, it seems that recycled television will be the norm for the foreseeable future.
The Impact of Strikes on Netflix and the Streaming Industry
The ongoing strikes in the entertainment industry have had various repercussions, affecting both consumers and businesses. Notably, these strikes have driven many consumers to seek alternative forms of entertainment, such as YouTube, TikTok, and video gaming. This shift has become a net negative for all parties involved and has further weakened the already struggling theatrical attendance, making it challenging to regain pre-Covid levels.
Industry experts argue that all parties should return to the negotiating table and find common ground on the various issues at hand. The negotiation process is crucial for finding solutions that are mutually beneficial and can help address the industry's challenges.
Amidst these strikes, Netflix appears to be in a favorable position compared to its competitors. As demonstrated by the popularity of shows like "Suits," Netflix has the ability to attract viewers even without new content. Loop analyst Gould highlights this advantage and believes that Netflix's extensive library of unreleased movies and shows gives it a unique edge over other players who are suffering from the lack of fresh content. As a result, Gould upgraded Netflix's stock to Buy, setting a price target of $500, reflecting a 15% increase from the previous day's closing price.
Despite the uncertainty caused by the strikes, now may be an opportune time to consider purchasing Netflix stock. Although Netflix shares have experienced a 47% increase year-to-date, they remain 37% below their all-time high of $691.69 reached on November 17, 2021. Additionally, the stock has been trading sideways for the past two months. As long as the stock holds steady at $400, a target price of $500 seems reasonable.
Investing in Netflix not only offers potential financial gains but also provides viewers with an array of entertainment options to enjoy, beyond just watching "Suits."