Are all involved with the project (actors/director, etc.) paid upfront and Netflix or whoever gets the payments per stream? Or are royalties paid?
In: Economics
Most of the people involved in the show are paid an hourly wage or salary like any other employee. The stars of the show, director, and/or producers may get both an upfront salary and entitlement to a percentage of the show’s ongoing revenue.
That ongoing revenue derives from how the shows are produced. A production company makes the show and owns the rights to it. The production company then sell those rights to the streaming service. The rights to a show aren’t always sold to a streaming service permanently – its more common that they’re sold for a limited period of time, after which the production company can resell the streaming rights to someone else.
Its also more common for a production company to sell streaming rights for a lump sum, rather than to include an ongoing royalty. IE, the streaming service makes a one off payment of $X and then gets to stream the show for Y years. That being said, in some cases there will be a royalty paid based on total streams watched.
Again, that money doesn’t go directly to the actors, it goes to the production company. If the actor is entitled to a percentage of the revenue that the show earns, then the production company pays the actor out of the money it receives from the sale of the streaming rights.
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