For the past two years, Netflix has sought to redefine itself as not merely a distributor of other studios' content but also as a programmer in its own right.
Now, after collecting 14 Emmy nominations Thursday, Netflix's original-content strategy has won validation from the company's traditional-media peers.
The Los Gatos, Calif., company has been refining its approach to programming, opting to stop paying top dollar for every movie and TV show out there, unless Netflix can offer them exclusively to its 36 million subscribers. The company also has become more discerning and is unafraid to drop shows that fail to attract enough viewers to justify the price.
This strategy informed Netflix's decision in the spring to allow its broad licensing agreement with Viacom to lapse – saying it preferred to hand-pick shows, such as “SpongeBob SquarePants,” rather than accept a bundle of programming from Nickelodeon, MTV, BET, VH1, Logo and Spike.
At the same time, Netflix has invested heavily in original series, theorizing that such programming would help define it as the Internet's leading TV network, much as the critically acclaimed “Mad Men” helped elevate AMC or as “The Sopranos” redefined HBO.
Netflix's $100-million, two-year bet on “House of Cards” delivered a full house of nominations for the political thriller, including best drama, best director for David Fincher, best actor for Kevin Spacey and best actress for Robin Wright.
The company also collected a lead-actor nomination for Jason Bateman for "Arrested Development," the irreverent comedy canceled by Fox in 2006 and revived for a fourth season by Netflix (and production company 20th Century Fox TV). Even Netflix's horror series "Hemlock Grove" garnered two nominations for visual effects and theme music.
The company observed the watershed moment, which marked the first time that an Internet TV network merited Emmy Award consideration in the same categories dominated by broadcast and cable channels.
"We are overwhelmed with 14 nominations and honored by a warm welcome, which corroborates what we have always believed -- that great television is great television, regardless of where, when and how it is enjoyed," Netflix Chief Content Officer Ted Sarandos said in a statement.
Dan Cryan, digital media analyst with I.H.S. Screen Digest, said the nominations helped increase the distance between Netflix and its online competitors, Amazon.com and Hulu, which also have been investing in original programming."If you're in Los Gatos, you’re presumably relatively happy that you’ve won this stuff and none of the stuff that Amazon does has, and none of the stuff that Hulu has done has," Cryan said. "That’s truly a reflection of the models they’re pursuing, and where they’re at in that process."
Although many consider this a ground-breaking moment in the evolution of Internet TV, Cryan observes that Netflix is applying a formula that has worked for decades in the cable-TV world.
"The more things change, the more they stay the same. We have a subscription-funded provider of high-quality programming picking up a lot of Emmy nominations. That's been happening in conventional TV for quite a long time now," Cryan said. "What’s new, of course, is the fact that it’s not reliant on the traditional TV infrastructure for distribution."