UPSIDE DOWN

Netflix is getting its first taste of the theme park business with “Stranger Things”

Obsession
Glass
Obsession
Glass

The Upside Down is coming to Universal Studios. And no, it’s not a new rollercoaster.

Netflix’s popular sci-fi series Stranger Things is being brought to life in three Universal Studios parks this fall, as part of NBCUniversal-owned parks’s annual Halloween Horror Nights series. Universal’s Hollywood, Orlando, and Singapore parks will each feature themed mazes set in the show’s parallel universe, the Upside Down, which mirrors the fictional town of Hawkins, Indiana. The experience, which is being built in partnership with Netflix and the show’s creators, will even have a Demogorgon to stalk guests.

The deal with NBCUniversal—Netflix’s first in the theme park space—is another example of the internet-TV company cashing in on the original productions it paid so handsomely for. Netflix has been self-producing more content, snapping up the global rights to TV series and movies, and making acquisitions like its deal for publishing house Millarworld, in part, so it can control the licensing around those properties. Millarworld will continue to print comic books, some of which will be tied to upcoming Netflix TV shows and movies like The Magic Order. All told, Netflix has $8 billion earmarked for content this year. In 2017, it cut some of its first merchandising deals with brands such as Target for Stranger Things toys and other products.

It gives Netflix a taste of what it’s like to have the distribution mechanisms of a conglomerate like Disney or Comcast, which own theme parks around the world and sell toys and other merchandise tied to their entertainment properties. Licensing and merchandising are relatively new revenue streams for Netflix, which makes most of its money from streaming-video subscriptions and a small chunk from its lingering DVD-rental business.

CEO Reed Hastings told reporters last month that theme parks aren’t in the company’s growth plans for the next 5 to 10 years. But don’t rule them out. “That would be amazing,” he said. “When I go to theme parks, I think can you imagine Netflix content here some day? But not in the short term.”

It’s easy to see the appeal if you can pull it off: Parks and resorts generated about one-third of Disney’s revenue in 2017, or $18.4 billion, and about 16% of Comcast’s with $5.4 billion in revenue. For context, Netflix’s entire business brought in $11.7 billion in revenue last year. Perhaps the Stranger Things activation will whet Netflix’s appetite for immersive experiences.

“Licensing and merchandising though, that’s a big one for us,” Hasting said, citing the Target deal. “We’ll be doing more of that.”

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