When Ryan Murphy struck his five-year agreement with Netflix in 2018, reportedly worth as much as $300 million, it was believed to be the biggest TV deal ever. But did it pay off for the streamer? And how much of a loss will it be if he strikes a deal with Disney, which now owns FX, Murphy’s former home base?
Measuring the contribution of specific works to a subscription service is difficult, but Parrot Analytics’ Content Valuation System, based on data which takes into account consumer research, streaming, downloads and social media, among other engagement, can put a number on it. By our measurements, Murphy’s works spanning from his first Netflix original, “The Politician,” to his most recent release for the platform, “The Watcher,” have contributed $341 million to the company’s revenue.
That means Murphy’s shows have at least covered the headline cost of the deal, if not production costs. Of course, even after Murphy leaves, Netflix will retain the rights to stream the shows he made for it, generating ongoing revenue. And there could be additional seasons of existing shows, which Murphy could continue to work on for Netflix.
One important note is that not all of these titles fall under the scope of the $300 million contract. For example, Netflix announced a two-season order for “Ratched” in 2017, before inking the megadeal with Murphy. Still, looking at the total revenue contribution to Netflix of all his shows helps us quantify the value of the partnership.
It’s eye-opening to dig into how exactly Murphy’s body of work for Netflix reached this number. For example, despite being one of the most recent releases, “Monster: The Jeffrey Dahmer Story” is already responsible for 37% of the revenue Ryan Murphy titles generated in only three quarters since it premiered. It was this show that pushed the cumulative revenue figure over the $300 million mark by the end of 2022.
And long-running shows can be important contributors too. “Ratched,” which premiered at the end of 2020, accounts for 21% of the total revenue generated for Netflix by Ryan Murphy titles, despite only running for a single season.
“Monster: The Jeffrey Dahmer Story,” “Ratched,” and “The Watcher” together account for 64% of the revenue generated by Ryan Murphy’s body of work for the streamer as of March 2023, highlighting how top-heavy Murphy’s output for Netflix has been.
This analysis shows how even a big deal like Murphy’s can depend greatly on a handful of hits. This raises the question of whether the company could have made more targeted investments that generated nearly as much revenue with fewer titles and a smaller price tag. That said, a hits-driven strategy has been common in entertainment long before streaming hit the scene.
Christofer Hamilton is a senior insights analyst at Parrot Analytics, a WrapPRO partner. For more from Parrot Analytics, visit the Data and Analysis Hub.
