NetflixI'm watching House of Cards after paying $7.99 to see the whole season. Am I robbing Netflix? How will they make money?
—Watson 6, via Twitter
This is an excellent question, given that the Kevin Spacey/Kate Mara series cost Netflix a whopping $100 million (?!) for two seasons. That's $100 million for 26 hours of show.
Yes, the series is a barnburner, but a hell of a lot of a money is going up in flames in that barn.
And you're right. Your $8 monthly streaming subscription fee does not equal $100 million by any stretch. But here's the truth: Whether the series makes Netflix money or not, the company had to buy that series. Had to. And not just because Robin Wright is 46 and still the hottest creature on planet earth.
No, Netflix had to buy the American version of the hit British series for one reason: Survival. Long term survival.
"They need to differentiate themselves from other competitors like Hulu Plus," says The Hollywood Reporter's Andrew Wallenstein, who follows the company closely. "It's not enough to have same old episodes of CSI anymore. You have to have stuff that others won't."
Think he's being alarmist? Consider: "Netflix's competitors are all doing exclusive deals for content," he says. "Recently, Amazon Prime got a deal to get Downton Abbey exclusively. So, in time, you won't be able to see that on Netflix.
"So Netflix needs to get their own stuff to replace that content."
(I know, I know: Downton Abbey is about to get harder to find? Pass the smelling salts, old girl!)
As for whether Netflix's $100 million gamble will pay off—or its gamble on an Arrested Development revival, for that matter—it's just too soon to say.
"We won't even get the earliest indication of that until second quarter earnings come out ," Wallenstein says. "But the company doesn't expect to see this immediate increase in subscriptions. These things take time."
In the meantime: Downton Abbey! Is being enslaved by Amazon Prime! Will no one fight the entail?