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Open discussion of Media / Shows / Television
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I don’t understand how this math works. The service has subscribers, there are no ads. How does a single show turn its own profit?
Parrot came to these figures via its Content Valuation methodology, which uses a formula to correlate audience demand with subscribers and therefore revenue.
‘Audience demand’ and subscribers equals a specific revenue for a specific show? Still don’t get it.
So you start by pretending you have no money.
Then you launch a new show (or movie) and note how many of your subscribers watched, both existing and new.
If all your existing subscribers turned into the new show, you can look at what else they watched in the last 30 days to get an idea of how many of them tuned in for this exact show.
In Apple's case they have a limited selection. So if someone watched nothing in the past 30 days, but they watched this, you can attribute the majority of their money to this show.
New subscribers are technically worth more since they're a new revenue stream. People form habits and they are unlikely to leave the service.
For example if you make one new show per month and each show is just ok, you'll probably lose subscribers. But if you put out an amazing show first, then a just ok show, you'll probably keep most subscribers, especially if another great show is right around the corner.
In the specific case of Severance, I would bet Apple has been generally on the decline in terms of subscriber count. I would bet they just added a bunch of the most valuable, new subscribers, this past week. They have a value assigned to those new subscribers and can easily calculate that they've made money.
This makes a lot of sense, thanks for the explanation!