Netflix steps up release of originals in push for ‘must have’ status

Company’s massive content production budgets to be financed by long-term debt

 

Clear your busy work-life-family schedules – or, alternatively, swear off television forever. It’s gearing up to be a release- packed spring for Netflix, the internet video streaming company with an estimated 340,000 customers in Ireland and an annual content budget of $3 billion (€2.65 billion).

Compared with the dizzying raft of new shows being added to the platform, House of Cards now resembles something of an old friend, albeit an untrustworthy one you wouldn’t let near your pet. Its third series will be released on February 27th.

Unbreakable Kimmy Schmidt, Tina Fey and Robert Carlock’s half-hour comedy series about a woman who escapes a doomsday cult, will debut on March 6th, while Sony Pictures Television’s promising ensemble drama Bloodline, about a family that has its emotional demons exposed when the “black sheep” returns, is pencilled in for March 20th.

Other Netflix Originals lined up – and there are now too many to count – include Marvel’s Daredevil, the first of four superhero-type series that Disney’s Marvel Entertainment has signed up to make for Netflix, and Grace and Frankie, a septuagenarian comedy starring Jane Fonda and Lily Tomlin. So that’s more than one demographic base covered then.

Earlier this week, Netflix began its one-episode-a-week release of Better Call Saul, the Breaking Bad spin-off featuring sleazy lawyer Saul Goodman (Bob Odenkirk), and in Ireland, the company’s out-of- home advertising for the series includes posters in the doors of old Eircom phone boxes.

Netflix has more than 57 million subscribers worldwide, and while it doesn’t isolate the size of its customer base in Ireland, consumer research conducted last autumn by the media agency Carat suggests that it has about 340,000 users here - in other words, almost one in five households (19 per cent) have a Netflix account.

Its Pulse study found that an additional one in 10 consumers said they planned on taking out a subscription in the next 12 months.

Netflix is starting 2015 how it means to go on. The California-based company last month told shareholders that the production of original content was better value than acquiring rights through expensive licences.

“There is one real shocker – last year our original content overall was some of our most efficient content. Our originals cost us less money, relative to our viewing metrics, than most of our licensed content.”

Over the next few years, Netflix plans to finance an acceleration in its original content production with more than $1 billion in long-term debt, with the interest cost built into its budgets.

A greater proportion of its marketing budget – and an eye-watering $607 million was spent on marketing in 2014 – will be dedicated to the promotion of its new shows.

Netflix believes that in most US households, it will eventually achieve “must have” status. Could it do the same in a market like Ireland?