Couple Watching Netflix

We will see more change in the online video sector over the next five years than anyone can imagine. New players will dominate old players, traditional business models will be flipped on their head, and new means of content delivery will be born out of devices we already own. Sounds a little bit like the music industry, doesn’t it?

According to Deadline Hollywood, Netflix has outbid HBO, AMC, and other major cable networks for David Fincher’s new drama series House of Cards featuring Kevin Spacey. Negotations between Netflix and Media Rights Capital, the industry’s largest independent film and TV studio, are still taking place. It is rumored that the entire deal is estimated to be worth more than $100 million considering that Netflix offered a two-season commitment (26 episodes) valued at approximately $4 million to $6 million an episode, not including the cost of marketing and promotion.

Netflix is showing a lot of faith in David Fincher and others to create a successful, straight to series show by signing up for a two-season commitment. Currently Netflix controls 61% of the movie streaming market, so it should be interesting to see if they can successfully leverage their distribution to consume its own original programming.