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A decade of "The House of Cards": the series after which television changed forever - voila! culture


A casual comment in a routine meeting 12 years ago, led to a complete change of television as we knew it. The result was the formation of the largest and most influential entertainment giant on the medium

Trailer "House of Cards" season 2 (Netflix)

The year 2011 opened with celebrations at Netflix headquarters.

The company that started out as a humble DVD delivery service by mail, crossed the 20 million subscriber mark and began to blow in the back of the great HBO.

At the same time, she signed huge contracts with the leading studios in Hollywood, which will guarantee her a regular supply of new library films in the years to come.

With the successes came the appetite, and in a conversation with the company's investors, the CEO, Reed Hastings, was asked if Netflix was ready to abandon its exclusive reliance on the content of others, jump into the pool of original content itself and become a player in the market. Hastings cooled the enthusiasm: "I'm a big believer in the circle of competence ", he told investors, referring to the business concept that differentiates between what the company thinks it's good at, and what it's actually good at. "Once we start talking about creative risks - that is, reading a script or assessing whether someone can fit a certain role - it's not something a company Technology can build a unique service around it."

A few weeks after the conversation, Netflix's content manager and Hastings' right-hand man, Ted Sarandos, met with the people of the production company MRC, which specialized in independent films.

The meeting focused on the possibility of a deal that would bring the movie "Bruno" to Netflix, and was about to end.

Just before the closing, one of those present turned to Serandos and casually told about the first television project in the company's history: an American adaptation of the British television series "House of Cards", starring Kevin Spacey and Robin Wright and directed by David Fincher, who was nominated for an Oscar that year for "The Social Network".

When asked if he would be interested in watching the first two episodes, Sarandos, an avid TV fan who watched and loved the original series, didn't hesitate.

Apparently there was no sense in this step.

Netflix, as mentioned, has never produced television content on a large scale, nor did it intend to do so.

Ted Sarandos realized that if Netflix were ever to gamble on becoming a content producer, its biggest mistake would be to start small and test the waters.

She has to go big

After watching and being enthusiastic about the first episodes, Sarandos realized two things: the first is that there is no chance that Netflix will get a series like this in the foreseeable future, simply because whoever buys it will want to continue to own it.

The second thing he realized was that if Netflix ever gambled on becoming a content producer, its biggest mistake would be to start small and test the waters.

She has to go big.

An examination of Netflix's (once upon a time) very efficient algorithm proved to Serandos that his hunch was well-founded: content by Spacey, Wright and Fincher was very popular among Netflix subscribers, and their combination summoned the potential for a possible hit.

There was only one small problem: AMC, FX, Showtime, and the great HBO were competing for the rights to the series.

Each of them constituted a worthy home for the new creation, with rich experience in creating and marketing original content, and a record of commercial and critical successes.

Netflix was the place to watch "Dead to Live".

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Made the huge step without the CEO even knowing. Ted Sarandos (Photo: AP, Richard Shotwell/Invision/AP)

Unofficial stories claim that HBO was so close to signing and then Netflix came in with its offer, and it happened so quickly that on Friday HBO was already sure the series was closed with them, and on Monday the world found out that Netflix had picked up the series

The plan of the "House of Cards" producers was to hold a special screening for the representatives of the interested networks, after which the negotiation phase would begin.

Sarandos decided to make her irrelevant.

The day before the screening, he approached MRC representatives and pledged to purchase the rights, on the condition that he would be able to personally present to Fincher the reasons why he should choose Netflix.

"There are a thousand reasons why you shouldn't choose us," Sarandos told the director at the meeting, "I'm going to give you two why you should do it: We'll give you two seasons in advance and complete creative freedom."

In those days ordering a season in advance was considered a gamble in the television industry, two seasons in advance was unprecedented.

The price that Netflix was willing to pay for the rights, $100 million, was also higher than anything offered by competitors.

And so, while the company's CEO tells investors about its solid and efficient direction going forward, his number two opted for a complete model change, making a bet on a historic scale. Hastings himself, by the way, only learned about the deal after it was done. Unofficial stories claim that HBO was so close to signing and then Netflix came with its offer, and it happened so quickly that on Friday at HBO they were already sure that the series was closed with them, and on Monday the world found out that Netflix picked up the series.

And here's another way in which romantic revolutions end up being completely accidental.

About a year and a half after the deal, Netflix owned the first 13 episodes of "House of Cards", and faced the dilemma of how to distribute them.

The company's business model was to purchase old seasons in their entirety and upload them to the platform, so that they would be available to subscribers.

It seemed strange that only one series would deviate from this model and suddenly be broadcast in a weekly format.

To test the method, Netflix purchased "Lillihammer", a comedy crime drama starring Steve Van Zandt ("The Sopranos") and uploaded all its episodes at once.

Although "Lillihammer" was and remains a fringe series, the results of the experiment proved to the people of Netflix that the method works.

"House of Cards" didn't set out to invent the binge, but Netflix viewing habits made it do so.

The company, which did not set out to become a content producer, instantly became a star, and along the way changed the way people consume new television.

Exactly a decade ago today, on February 1, 2013, "House of Cards" first appeared on the Netflix servers.

The sequel is already known: "House of Cards" won dozens of nominations for major awards, was the first streaming series to be nominated for the best drama series at the Emmys, thrilled critics and viewers and became a huge cultural phenomenon.

Some would argue that she also succeeded in predicting the future of political culture in the US and elsewhere in the world. Her viewing figures are kept by Netflix, but the increase in the number of subscribers could not be hidden: 12 million new subscribers were added during the next 12 months and 13 million in the year after "House of Cards" more than doubled in two years what Netflix had built over the previous decade.

In the closing scene of the last episode of the second season (and the last of the Fincher era), Frank Underwood, the Machiavellian majority whip starring Spacey, fulfills his journey surrounded by intrigue and crime from the grayness of the congressional benches to the Oval Office.

He places both hands on the iconic table, looks directly at the camera and pumps his fist twice.

Since then, this is the sound that accompanies every opening of every viewing of every Netflix content.

And yes, there is definitely something poetic about a man like Spacey, in the persona of a man whose initials are FU, symbolizing the most powerful streaming service in the world.

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The irony is that Netflix has become a blockbuster in the last decade itself.

One of the reasons for this is the fact that the competing studios stopped selling it content, but Netflix also fell in love with its enormous buying power, with unimaginable amounts of new content every day

The successful experiment of "House of Cards" dramatically changed the worldview of Netflix.

In a famous quote from Sarandos from 2014, he defined the company's updated motto: "Become HBO faster than HBO will become Netflix."

Netflix realized that it was facing a short window of time in which it had an advantage over its competitors: it was the only one that had a successful streaming service with subscribers.

While they are organizing and dealing with establishment and procurement, it must seize a gap that will establish it as the strongest force in the market.

This is how the vicious circle that fed Netflix for years was created: it raised huge budgets from investors, which it invested in huge amounts of original content that brought more subscribers, which led it to raise more money to invest in more content that would bring more subscribers.

Wall Street fell in love with the company's constant growth, and Netflix became a giant supermarket of content.

This approach made it the leading cultural force in the world.

She changed not only the television industry, but also the film industry.

With enormous financial capabilities and endless real estate in its library, it began to attract the biggest stars and creators to it, influencing distribution windows and viewing habits that developed over decades. The thing is, this transformation was completely at odds with what made Netflix Netflix. Its biggest victory over Blockbuster of the decade The first of the current millennium, was based on understanding the state of the average viewer. While Blockbuster got involved in huge expenses to guarantee its customers almost only (relatively) new content, Netflix realized that most viewers do not have the time, ability or desire to consume only the fresh. They would prefer in many cases watch something old or something you've already watched before.

The irony is that Netflix has become a blockbuster in the last decade itself.

One of the reasons for this is the fact that the competing studios stopped selling it content, but Netflix also fell in love with its enormous buying power, with unimaginable amounts of new content every day.

Trying to produce "something for everyone".

Already today one out of every two contents on Netflix is ​​original, and the ratio increases by one percent every month in favor of original contents.

If this rate continues, by 2027 you will only find content created by Netflix in its library.

At the same time, the algorithm became predictive of everything.

Successful content was replicated in countless versions, while others that were more niche, or those that required more patience or long-suffering, were canceled without blinking an eye.

The reason many viewers can't find anything to watch in Netflix's endless amounts of content is a consequence of this approach.

The attitude of quantity over quality collided with the wall of reality last year.

In the first quarter in which Netflix reported negative growth expectations, Wall Street's enthusiasm faded.

The company's stock fell sharply and led to widespread layoffs and the development of what is considered the sacrilege of the proud Netflix: an ad-based subscription with a reduced fee.

It has to be said that the prophecies of outrage, and in many cases the joy of Eid, over the collapse of Netflix were exaggerated.

Although Disney Plus has overtaken it in terms of subscribers, Netflix has recovered and is still a formidable force, but where does it go from here, and just as importantly, where does the streaming industry go?

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could not refuse the offer.

David Fincher (Photo: GettyImages)

Netflix is ​​expected to invest $17 billion in content this year.

It's a crazy amount of course, but it also symbolizes a trend.

For the first time in years, the streaming service's content budget did not increase compared to last year.

In other words, Netflix is ​​already starting to choose the next projects a little more carefully

FX CEO and so-called "Mayor of TV" John Landgraf is considered one of the most reliable analysts of the industry's streaming wars and direction. In August 2015, during a panel at the Television Critics Association convention, Landgraf coined the term "Peak TV." Refer to the trend that led Netflix to a huge increase in the amount of content. If in 2011 182 series were broadcast on television, then in a little more than a decade the amount tripled and even more. About 600 scripted series were broadcast during 2022 on American television, and if you add to them films, series in foreign languages ​​and reality content, You will easily reach even more astronomical amounts. Landgraf already claimed eight years ago that this amount is unrealistic, neither for viewers nor for content producers, and that eventually a peak will come after which the market will correct itself.

This prediction is even more dramatic when you consider that the young and attractive target audiences spend many hours on YouTube, Instagram, Twitch and TikTok.

In an age where every cute ostrich competes with "Wednesday", the ability to consume amounts of content is reduced even more.

Although 2022 continued the trend of growth in the number of series, a deeper look at its data may make it the peak year predicted by Landgraf, the one after which we will begin to see a decline.

TV companies in the US ordered 24% fewer series in the last six months compared to 2021, and 40% less compared to the same period in 2019.

And in general, a look at the market shows that the actresses who make a splash in reviews and award ceremonies - HBO and Apple TV Plus - are the ones who have continued to carefully choose their content, instead of buying everything that moves and throwing it into one library.

Netflix itself is expected to invest 17 billion dollars in content this year.

It's a crazy amount of course, but it also symbolizes a trend.

For the first time in years, the streaming service's content budget did not increase compared to last year.

In other words, Netflix is ​​already starting to choose the next projects a little more carefully.

After a few turbulent years, there is also a stabilization in the number of players in the market.

HBO is still in the midst of approving a Discovery-Warner deal that would create a new unified streaming service, but unless the currently thin rumors of Microsoft buying Netflix are true, it doesn't look like other giants are going to try to enter the turbulent streaming field.

Still, in Landgraf's estimation, we are only halfway through the road that began with the outbreak of the arms race between the technology giants.

"I don't think we've reached a compact business model yet," he explained in an extensive interview he recently gave to Welcher.

According to Landgraf, the difficulty lies in the number of players who have invested huge sums in recent years to enter the "new ecosystem" of television, and are finding it difficult to generate profits over time.

"I have no doubt that we will reach an equilibrium again that will last for several decades as it was in the previous model, but such things require time."

In other words, Landgraf implies that we have reached the Darwinian stage in the streaming wars - the stage where the established and powerful turn the smaller ones into content providers at best, or eliminate them at worst, so that they have enough to survive.

These processes have already taken place at Disney in recent years with its many procurement transactions, and it is not certain that we have seen the last of them.

Another intriguing insight from Landgraf relates to Netflix's original worldview, and the nature of viewing for most of us.

According to Nielsen data, viewing of streaming services is divided into 25% consumption of new content and 75% viewing of library content.

This of course explains the enormous and continuing success of "Friends", "The Office" and "Seinfeld", and the enormous attractiveness of the possibility of keeping them for a long time.

But also in general, most of us choose to watch something old most of the time, or at least we would like someone else to choose for us.

Therefore linear channels,

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Soars in Netflix because she believes in the all-from-everything approach.

Bella Bajria (Photo: GettyImages, Emma McIntyre/Getty Images for Netflix)

If at the beginning Sarandos aspired to become HBO, today he defines the company's strategy as the replacement of the entire television: "We want to be both FX, HBO, AMC, Lifetime and Bravo," he said

As then, Landgraf's prophecies are coming true before our eyes.

Netflix recently added about 30 hours of fitness content from Nike to its library.

At the same time, it also continues to invest in small games that join its catalog, and starting in 2024, it will broadcast the SAG (Actors Guild) awards ceremony.

These are all content moves we haven't seen from her before, and they indicate her attempt to fight who she sees as her main competitors for the time of her target audiences.

Some of its competitors, such as Amazon and Apple TV Plus, have already entered the worlds of sports broadcasting, and big money has been poured into supplementary sports content (mainly docu-series, but not only) that will make fans invest more of their time within their platforms.

If you're looking for a more accurate definition of where Netflix is ​​going, it's in the hands of Bela Bajaria, head of global television, which is the most important growth engine at Netflix today.

Recently, as part of the retirement of Reid Hastings from the position of CEO of the company, Bejaria was promoted to the position of director of content at the company - the position that Sarandos held before taking Hastings' place as CEO.

Bajria is an example of Netflix's notorious management culture - she became one of the most important figures in the company at the expense of Sidney Holland, who served for about two decades as Sarandos' right-hand man and was a significant part of building the Netflix empire.

If at the beginning Sarandos aspired to become HBO, today he defines the company's strategy as the replacement of the entire television: "We want to be both FX, HBO, AMC, Lifetime and Bravo," he said.

Bajria was chosen for the position because, unlike the Netherlands, she believes in Netflix's "everything from everything" theory, and especially in its localization.

About two-thirds of Netflix's 223 million subscribers today come from outside the U.S. And while everyone together will still be watching the new season of "Stranger Things," Bajaria is tasked with wrapping them up in local original content. She's in charge of liaising with Netflix's bases around The world: from South Korea to Mexico, from Spain to Jordan. Each such local unit produces an ever-increasing amount of content. Most of this content is used as a placeholder, a tool to retain viewers who have finished Netflix's "big" content and are looking for more. But once in a while these local enterprises form an international phenomenon Like the "squid game", and turn the local into global. This creates the possibility to produce spin-offs and reboots or parallel versions as the Netflix algorithm likes so much.

Bottom line, Netflix is ​​no longer content with the glitzy and the glitzy.

It still continues to invest huge sums in content and famous creators, but it has no interest in quality competition with competing services.

An excellent example of this is the way the company resolved the great tension that had built up in recent years with the French cultural industry, around its participation in the Cannes Film Festival.

The heads of the festival refused to allow Netflix to gain prestige at the expense of one of the important events of the big screen, and at the same time to upload the same content on television.

Instead of fighting, Netflix just solved the problem with money.

It began financing French productions at a dizzying rate of 20 films every year, at the same time as financing series and television content in French.

Although it is not only about quality content that would be worthy of Cannes, the very presence of Netflix in French culture no longer allows the festival captains to ignore it.

Today Netflix is ​​considered the most important production body in the French industry, although the most successful content it has invested in is "Emily in Paris",

Although Israel is a small market for these global ambitions, there is quite a lesson here regarding the risk and the potential of Netflix's current approach.

It is ready and able to pour a lot of money into any local market it is interested in, thus allowing the local creators much greater resources than they had before, but also on the way to taking over the local industry and turning it into Netflix.

And if a market like France fell so easily, it is not certain that a country where public content budgets are threatened by politicians, will be able to maintain its cultural identity for a long time.

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Source: walla

All tech articles on 2023-02-01

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