Thursday, March 17, 2011

Cheaper TV's take on Netflix Original TV Shows: What a Gift!

As reported on the Cheaper TV twitter feed, Netflix is in negotiations to purchase an original show; "House of Cards" starring Kevin Spacey.  This is a major, but logical, shift in strategy for Netflix, and puts it in direct competition with the likes of HBO, Showtime, and Starz pay cable channels which all show original content.  Those pay channels have been attracting viewers for years with their own original series like "The Sopranos", "Weeds", and "Spartacus".  Not having it's own content, Netflix has been at the mercy of the Hollywood studios and pay TV channels to provide content for it's service.  This is a bold but calculated step to keep Netflix somewhat independent.  Networks have start grumbling about Netflix's power in the market.  Many network execs have felt that Netflix undervalues their content by making it available, online and on demand for too low a monthly subscription fee, and have threatened to marginalize Netflix by only giving them access to outdated content.

Cheaper TV take: This is great news for Netflix subscribers and could have a major affect on the industry as a whole.  For those of us that replaced cable TV with an antenna and a subscription to Netflix, we can expect to see even more shows available on Netflix.  Companies like HBO and Showtime have to be thinking about how to divorce their content from exclusive cable distribution.  For instance, HBO is now making their shows available for online streaming through their HBO GO service.  This service is only to people that subscribe to HBO through a cable company.  So someone like me, that no longer has cable would be shut out.  If HBO wants to keep up with Netflix and Starz Play, it's going to have to open their content up to the general population and make it available through as many distribution outlets as possible.