Netflix Inc. will lose its No. 1 show, “The Office,” in 2021 when reruns of the hit sitcom move to a new streaming service being launched by Comcast Corp.’s NBCUniversal, the latest sign of competition over top programming among Hollywood’s titans.
Terms of the five-year deal weren’t disclosed. People familiar with the matter said it is valued at around $500 million. Netflix had paid $100 million for its current multiyear deal.
In a statement on Twitter, Netflix said: “We’re sad that NBC has decided to take The Office back for its own streaming platform—but members can binge watch the show to their hearts’ content ad-free on Netflix until January 2021.”
NBCUniversal’s TV studio produced “The Office,” which ended its nine-season run on the NBC network in 2013, and licensed reruns to Netflix, where it has been the No. 1 show for several years, accounting for 52 billion viewing minutes in 2018.
The deal is between two divisions inside NBCUniversal—its streaming unit is acquiring the rights from the Universal TV studio. Still, the show was shopped to other streaming services besides Netflix, including
Hulu and the new services from
and AT&T Inc.’s WarnerMedia, people involved in the sales process said.
The creators of “The Office” will get a share of profits from the new deal, as they did under the Netflix pact.
Reruns have been critical to the success of Netflix. Though Netflix has touted its production of originals like “Stranger Things” and “The Crown,” non-original “library programming” made up 72% of the minutes people spent watching Netflix in the U.S. as of October 2018, according to Nielsen data. Netflix discounts third-party research.
Otherpopular reruns on Netflixcould also leave the platform in the coming years as NBCUniversal and other media companies, including Disney and WarnerMedia, launch their own streaming services and look to bring back hit shows to their platforms. Those three companies account for content that made up nearly 40% of the viewing minutes on Netflix, according to the Nielsen data.
Another hit rerun on Netflix, the comedy “Friends,” could leave the service at the end of this year and move to the WarnerMedia streaming platform. WarnerMedia’s Warner Bros. studio produced “Friends.”
Set in Scranton, Pa., “The Office” follows a hapless group of paper salesmen and women and their bumbling boss. Based on the British sitcom of the same name, the show’s format was brought to the U.S. by Ben Silverman, who was an executive producer of the show and then went on to become president of NBC Entertainment.
Although Netflix made an offer to keep “The Office,” internally the consensus was that the program was likely to end up on the NBCUniversal service, a person close to the company said. Netflix has been boosting its spending on original programming over the Past several years in anticipation of losing acquired content to rivals.
While “The Office” will be gone from Netflix in January of 2021, the show’s star, Steve Carell, will be back on the platform in “Space Force,” an original comedy whose creator is Greg Daniels, a longtime executive producer of “The Office.”
NBCUniversal’s streaming service will be ad-supported and is set to launch in 2020. It will be available free to people who have an existing pay-TV subscription and available to others for a fee. It will feature the company’s popular TV and movie franchises as well as original content and programming licensed from others.
“‘The Office’ has become a staple of pop-culture and is a rare gem whose relevance continues to grow at a time when fans have more entertainment choices than ever before,” said Bonnie Hammer, chairman of NBCUniversal Direct-to-Consumer and Digital Enterprises, in a statement.
Disney, AT&T and Comcast have plans to enter the streaming-video ring, armed with well-known TV and movie brands. But can they hold their own against industry juggernaut Netflix? Photo illustration: Heather Seidel/The Wall Street Journal
Write toJoe Flint at[email protected]