Netflix's Original Film Problem: More Movies, Less Demand

Netflix revolutionized how we watch television, but its ambitious venture into original films appears to be flatlining with users. New data from Parrot Analytics reveals a concerning trend: as Netflix floods its library with more original movies, viewer interest continues to decline.

The numbers tell a stark story. From 2020 to 2024, Netflix increased the share of original films in its movie library from 15.5% to 19.8%. However, during the same period, audience demand for these originals plummeted from 28.3% to 12.3%. Meanwhile, licensed content saw its demand share surge from 71.7% to 87.7%.

This disconnect between supply and demand comes at a pivotal moment for the streaming giant. In April 2024, Netflix replaced its head of original film Scott Stuber with industry veteran Dan Lin, signaling a shift in strategy. While Stuber succeeded in establishing Netflix's legitimacy within Hollywood – convincing top talent and creators that the platform was serious about filmmaking – the actual output has struggled to capture sustained audience attention.

The growth in Netflix's original film catalog has been nothing short of explosive. Between 2017 and 2024, the platform's original movie library expanded by an astounding 935%, with the number of new original releases reaching their peak in 2023. This aggressive expansion reflects Netflix's broader strategy to reduce its reliance on licensed content from traditional studios, many of whom have launched competing streaming services and dabbled in pulling content from Netflix. 

However, the data suggests that Netflix may have prioritized quantity over quality. Despite producing some notable hits and Oscar-nominated films, the vast majority of Netflix's original movies fail to generate significant cultural impact or lasting viewer engagement. This stands in sharp contrast to licensed content, which continues to draw consistent audience interest despite (or perhaps because of) its familiarity.

The streaming landscape has changed dramatically since Netflix first ventured into original filmmaking. Competition for viewer attention is fiercer than ever, with multiple streaming services now producing their own original content. In this environment, simply having more movies isn't enough – they need to resonate with audiences and justify their production costs.

Enter Dan Lin, whose production credits include successful franchises like The Lego Movie and It. His appointment suggests Netflix recognizes the need for a course correction in its film strategy. The challenge ahead is substantial: how to develop original films that can compete with both theatrical releases and beloved licensed content while maintaining the volume necessary to keep subscribers engaged.

The stakes are high. Netflix spent billions building its original film division, and while this investment helped establish the platform as a legitimate player in the movie business, the declining demand numbers suggest a need to reassess how these resources are being utilized. The company needs to find a better balance between quantity and quality, ensuring that its original films don't just pad the library but actually drive viewership and subscriber retention.

As we move through 2025, all eyes will be on Lin's early moves at Netflix. Will he scale back production to focus on fewer, higher-impact releases? Will he push for more franchise development to build sustainable audience interest via selective theatrical bets like Greta Gerwig’s Narnia? Or will he find new ways to make Netflix's volume-based strategy more effective?

What's clear is that Netflix's current approach to original films isn't delivering the desired results. In an era where content is abundant but attention is scarce, simply making more movies isn't enough. The platform needs to find ways to make its original films matter more to viewers – a challenge that will define its film strategy in the years to come.