The show cost 21 million to make.
Bloomberg published a leak from Netflix showing the value was 891 million.
No explanation was given on how they determined that, but going to try.
First up, did it help Netflix gain subscribers?
Netflix has 209 million subscribers.
4.4 million subscribers added in the third quarter of 2021.
Up from the letdown of quarter two which was 1.5 million.
We wont know the value of Squid Game on subscriber growth until the end of this year when they release that, but here’s why I don’t see Squid Game adding much value.
The standard Netflix subscription is $14 a month.
$168 a year if paid monthly
If Squid Game brought in a million new subscribers, that in one year would be 168 million.
Big thing here is also Asia.
Netflix has 30 million subscribers in Asia and it’s a big goal to grow it.
Cost is cheaper at $5 a month.
If they can bring in a million subscribers there, which they did that last quarter, that’s 60 million.
That being said, I don’t really see a path for Squid Game to bring in 900 million in subscription value over the next 3-5 years.
Next up, merchandise.
Without spoiling the show, there’s a lot of merchandise potential.
Costumes from the outfits characters wear.
The cookies from the second challenge.
That creepy doll girl from the first challenge.
Netflix has never went public on merchandise revenue, but it’s estimated to be about 10-15% of their business. The total sales of licensed products is also estimated to be over 10 billion.
Squid Game will probably be a lot of that and it hit so many dimensions of merchandise that it could work. I’m also fully expecting 1 in 20 halloween costumes in NYC being Squid Game this year.
Third point, the future.
Most viewed show ever on Netflix and only the first season.
The show does end on a cliffhanger and there’s no reason a second, third and fourth season can’t be made.
One of the roughest parts of Netflix business model is people unsubscribing. Something which I guess next year, they see their first ever quarter losing subscribers at one point.
Something like Squid Game which 70% of people to watch it watched more than two episodes will likely retain subscribers for years who want to see this thing continue.
I actually think 900 million dollars is conservative and Netflix will make more than that off it in the next five years.
Final thing, I actually binge watched the show this week and fast review.
The dubbing, I thought I’d hate and minus the older annoying actress, everyone looked really good.
Characters all well acted and fun to see. Only issue is the current main villain and the main character are less interesting compared to others we saw.
The challenges were extremely suspenseful and had me on the edge of my seat.
It succeeded in basically turning an anime into a live action show and I hope more ideas like this come.
This wasn’t in my opinion anything like Breaking Bad, Stranger Things, Game of Thrones or Cobra Kai for me, but really fun watch. Not good enough for a rewatch, but excited for season 2.