On Friday, Netflix announced that it is funding new episodes of the show “Arrested Development,” a Fox comedy series that was cancelled almost six years ago. The episodes will stream exclusively to Netflix subscribers, among whom the show has been quite popular. It’s not yet clear how many of the original cast will be involved or how many episodes have been ordered, but these will be a precursor to the release of an “Arrested Development” feature film.
Earlier this year, Netflix commissioned a drama series, “House of Cards,” starring Kevin Spacey and directed by David Fincher. This series is rumored to cost in the tens of millions of dollars for its 26 episodes.
Netflix currently delivers 61% of all digital video to US viewers; while HBO has just under 30 million subscribers, Netflix has risen to 20 million.
Netflix is not the only player in the arena of delivering digital video; iTunes streams movies and tv shows on a per-show payment, Hulu is the destination for ad-sponsored television, Amazon announced a streaming video plan this year, and we can’t forget YouTube, serving up 150 years of free video content every day around the world. A few weeks ago YouTube announced that it has spent $100 million funding new content from major TV studios.
So far only Netflix and YouTube have jumped into the role of funding new content. What’s different about their two approaches is that YouTube received 150 pitches of new content ideas; they are spending $100 million on over a dozen series. Netflix carefully chose continuations or remakes of shows they know to be popular among their members, and are spending $100 million on just one series. Which will turn out to be the better approach? Only time will tell.
Expensive known content or moderately-priced unknown content? The next step along that path is to go to independent filmmakers, many of whom could create great webisode content for under $10,000 per episode. There are already opportunities for filmmakers to compete to create ads, so sending in pitches to create made-for-web episodic content isn’t far behind.