Netflix Raised Another Show From the Dead

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Netflix (NASDAQ: NFLX  ) is getting pretty good at raising the dead. Just ask AMC Networks (NASDAQ: AMCX  ) .

No, I'm not talking about AMC's hit zombie series, The Walking Dead. That title is nowhere near death, rising to break cable ratings records and lifting AMC shares a market-beating 30% over the last year. Critics and skeptics of newfangled distribution models would say that this is despite a distribution deal with Netflix for prior seasons. Netflix CEO Reed Hastings, of course, says that his streaming service actually helps AMC find new fans for existing hit shows like The Walking Dead. I'd say that the numbers are on Hastings' side. You be the judge.

The latest revival here is AMC's murder mystery show, The Killling, which was canceled last summer after an Emmy-nominated two-season run. It's coming back again, and Netflix suddenly seems sure to have played a life-saving role in its revival.

News Corp. (NASDAQ: FOXA  ) division Fox Television Studios, which produces the show while AMC manages distribution duties, wanted the darn thing to live. The producers talked to Netflix and DIRECTV (UNKNOWN: DTV.DL  ) about defibrillating the flatlined property.

DIRECTV has some experience with extending canceled shows, like when it added two more seasons to legal thriller Damages and three seasons to sports drama Friday Night Lights. So does Netflix, which will launch a fourth season of Fox sitcom Arrested Development this May -- after a seven-year blackout. DIRECTV was reportedly very interested but didn't bite in the end. Neither did Netflix, at least not directly. Instead, AMC reupped The Killing on its own. But Netflix must have had a finger in that life-saving pie.

Netflix just announced that it has landed exclusive rights to stream The Killing season 3 globally. The agreement with Fox shuts premium cable networks and other online subscription services such as Hulu or Redbox Instant out of the new season, and also brings the first two go-rounds to Netflix customers everywhere.

And the new season would probably not have happened without Netflix's help.

"Our agreement with Netflix played an extremely significant part in the studio's strategy that enabled us to bring The Killing back for a third season," said Fox Television president David Madden. It's safe to say that Netflix's license payments pushed this show out of the casket.

The show was originally canceled due to lower viewership even as the material snagged a second round of major awards nominations. This deal will serve as a litmus test for the idea of Netflix distribution breathing new life into forgotten shows. AMC certainly has reason to believe in Netflix helping out, given the continued success of The Walking Dead, Breaking Bad, and Mad Men after letting Netflix in on the fun.

And if both The Killing and the upcoming reboot of cult comedy Arrested Development both turn out to be hits, Netflix might just become the go-to destination for prematurely killed high-quality TV shows.

Can Netflix overcome the rising tide of movie services competition, and will its international growth aspirations really pay off? These are must-know issues for investors, which is why we've released a brand-new premium report on Netflix. Inside, you'll learn about the key opportunities and risks facing the company, as well as reasons to buy or sell the stock. We're also offering a full year of updates as key news hits, so make sure to click here and claim a copy today.

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