Netflix 'Stranger Things' creators launch production studio, plan series spinoff

As Netflix rides off the success of its “Stranger Things” franchise, the show’s co-creators, the Duffer Brothers, have cooked up a slate of projects for the platform – including a “Stranger Things” spinoff.

The Duffer Brothers will spearhead the projects under their newly formed production company, Upside Down Pictures. In addition to a series spinoff, a stage play set within the world of “Stranger Things" is currently in the works, Netflix said.

Other upcoming Netflix projects include a series adaptation of “The Talisman,” a novel by Stephen King and Peter Straub, as well as a live-action adaptation of “Death Note,” a Japanese manga and anime series.

The Duffer Brothers have tapped Hilary Leavitt, a producer who’s helped develop the shows “Orphan Black” and Netflix’s “Ozark,” to run the company.

“Hilary’s passion for storytelling is perhaps matched only by her passion for the storytellers themselves, for whom she is fiercely protective,” said Matt and Ross Duffer in a statement. “We feel extremely grateful to have her at our side as we build Upside Down Pictures.”

The unveiling of Upside Down Pictures and its project slate comes shortly after the second part of “Stranger Things 4” dropped on Netflix. After the season’s first part released on May 27, it broke the premiere weekend record for an English language TV show on Netflix – with 286.7 million hours streamed.

The show’s fourth season has now taken first place in the streamer’s all-time most popular English TV list – having 1.15 billion hours viewed in its first 28 days. Netflix said the final tally is expected to go even higher, once the season’s second volume reaches that 28-day benchmark.

“It’s no accident that ‘Stranger Things’ has pierced the zeitgeist to become the epic pop culture phenomenon it is today,” Netflix Co-CEO Ted Sarandos noted in a statement. “We’re excited to continue telling new stories with [the Duffer Brothers] as they grow Upside Down Pictures and to welcome Hilary as creative partner.”

“Stranger Things 4” is Netflix’s second series to cross the billion-hour viewing mark, with only “Squid Game” ahead at 1.65 billion view hours. Netflix recently announced it’s got a reality TV version of “Squid Game” in the works – capitalizing on the Korean drama’s popularity.

It will be interesting to see if Netflix’s “Stranger Things” high bears weight on the company’s second quarter earnings results, which Netflix expects to report later this month. The streamer in April announced a 200,000 net subscriber loss in the first quarter, and earlier this month confirmed plans for a lower-cost, ad-supported tier.

Barclays analyst Kannan Venkateshwar thinks that despite Netflix’s recent eyeball share with “Stranger Things” and “Ozark,” the streamer is likely to lose more subscriptions, as reported by Seeking Alpha.

"In our opinion, Netflix may need to rebalance its content mix a bit more towards quality, especially given competitive offerings from Disney, Apple, HBO and Amazon," Venkateshwar said, noting overall average quality of Netflix’s content looks “weaker,” particularly in TV shows.