Report: Netflix to offer original programming
Netflix may be looking to leverage some of its massive market share in streaming and downloading, reportedly outbidding major cable networks to carry a new television show exclusively on its platform. According to a report on Deadline.com, the entertainment company has won the rights to House of Cards starring Kevin Spacey.
The deal is said to be worth at least $100 million, and AMC and HBO had both apparently shown interest in the show. No doubt original programming is a whole new venture for Netflix, which has previously built its business on the distribution of other's content. But it is also a costly gamble with no guarantee of success.
Deadline reported that Netflix committed to two seasons of the show, or 26 episodes. Each episode could cost the company as much as $4 to 6 million, it speculated. The Wall Street Journal disagreed however, saying its own sources indicated the company was likely to pay far less.
While Netflix would get the rights of first carriage, Media Rights Capital -- the firm financing the series -- would be free after its run to seek broadcast on other networks or sell the series through DVD. Netflix had not publicly commented on the news, although a spokesperson for Spacey confirmed the talks. Media Rights Capital declined to comment.
Amid increasing competition, Netflix is finding itself looking for new ways to attract consumers to the brand. No doubt turning the company into a virtual network of sorts -- where content originates rather than is offered or rebroadcast -- is certainly one way that could be done.
Traditional cable networks like HBO and Showtime have done much the same. Initially just movie channels, the networks' moves to offer original programming like The Sopranos and True Blood have drawn customers to the premium networks and been a large part of its growth in recent years.
Netflix counted about 20 million subscribers at the end of 2010, a 63 percent increase over the previous year.