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How a Netflix Original-Series Deal Could Change TV-Making

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The entertainment-biz press, led by a report in Deadline.com, has the news this morning that Netflix may be about to acquire a high-profile original drama—political thriller House of Cards from David Fincher and Kevin Spacey—by outbidding the likes of HBO. Does this mean, if the deal pans out, that Netflix wants to become a TV network?

Actually, it could mean something bigger: the beginning, albeit the very beginning, of a much-theorized about move to a business model in which TV networks are optional.

Why do you watch TV networks at all? You don’t go to the movie listings and say, “Gee, I wonder what Paramount has showing this week!”—you just look for a movie. The reason for TV’s configuration was, first, technical and practical. A network controlled the means of distribution: it had the hardware and the system of affiliates that were necessary to literally beam a program from a tape somewhere into your living room.

That changed with cable, but we still had networks to pay for shows and create schedules. It changed more with DVD and TiVo and online streaming, all of which mean that is it theoretically possible to watch TV shows not on TV networks, without paying any attention to what channel airs them or when. Still, networks and channels remain central to TV—excluding online series like The Guild, which can be great but are still financially marginal—because they provide less-tangible support: not just paying for production, but bringing in a built-in audience, advertising and providing branding.

You may no longer need a network’s satellite dishes to get your show into homes, but you need it to draw attention to your show (again, with exceptions like Dr. Horrible).

Netflix is the kind of company that could further put a dent in this model, because it’s a business that has sufficient penetration and brand awareness to substitute for a network in launching a show: without the added burden of actually creating a cable channel or launching an entire complementary schedule.

People who use Netflix are alwready aware they have Netflix; they get its e-mails and updates; a reasonable promotional push could, theoretically, get them to order House of Cards the way they now might order Avatar. What channel is House of Cards on? I dunno—it’s on TV! I get it through Netflix!

Once that barrier is passed, it becomes easier to decouple the idea of watching a show from the idea of watching a channel—again, not that much of a cognitive leap when you think of how people watch movies. All of which could influence not just how we watch and pay for TV but what kind of TV can get made.

Right now, if you’re selling a show, you have to be very conscious of its fit with a particular network’s brand: is it an NBC show? CBS? Showtime? TNT? You’ll recall that when Lone Star flamed out, there was a lot of talk that it was a bad fit for network TV, but it was hard to figure what cable network it would have been good for: it probably was not aggro enough for FX, it seemed a little too conventional for HBO, etc.

Once entities like Netflix can acquire programs—without having to be “programmers”—that dynamic could melt away. You no longer have to fit a show to a channel, you just have to fit it to an audience.

Of course, all this is preliminary: the deal may not come off, or, as The Wall Street Journal theorizes, this could just be a play by Netflix for leverage with TV networks. But as more and more non-TV-channel entities get a direct pipeline onto your screens—be it Netflix or Hulu or Facebook or Amazon—there may be more channels for getting around making deals with channels.

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