"This wasn't supposed to happen."

-- Claire Foy, winner of the Best Actress in a Drama award for Netflix's The Crown, at the 2018 Emmys

In the weeks leading up the 2018 Emmy Awards, AT&T (NYSE:T) CEO Randall Stephenson dismissed competition from streaming pioneer Netflix (NASDAQ:NFLX), saying, "I think of Netflix kind of as the Walmart of SVOD (subscription video on demand), HBO is kind of Tiffany. It's a very premium, high-end brand for premium content." 

If the 2018 Emmy Awards are any indication, the quality of content on the two services is not as different as Stephenson would like to think. Netflix made history by tying HBO, taking home a total of 23 awards. This is the first time a streaming service has topped the list.

A scene from Netflix's The Crown with Claire Foy and Matt Smith attending a formal event in character.

Netflix's The Crown took home five Emmys. Image source: Netflix.

Making history

HBO's perennial favorite Game of Thrones took home its fair share of statues, with nine wins. The most awarded show for Netflix was The Crown, which took home five Emmys. Other winning shows from Netflix included western Godless, futuristic sci-fi drama Black Mirror, crime drama Seven Seconds, and stand-up comedy John Mulaney: Kid Gorgeous At Radio City

The trend over the past several years has been undeniable, with Netflix coming in third place for a number of Emmy Awards in 2016 and second place last year. This marks the 17th consecutive year that HBO finished in first place, even though it was forced to share the limelight with Netflix.  

Netflix's historic performance may have been inevitable, as a similar trend has played out in nominations as well. The streaming pioneer captured 112 Emmy nods earlier this year, compared to just 108 for HBO. As I noted at the time, "For the first time in 18 years, HBO didn't walk away from the Emmy nominations with the biggest haul."

It's also worth noting that Amazon.com (NASDAQ:AMZN) also had a respectable showing with eight awards, but Prime's The Marvelous Mrs. Maisel really cleaned up. The story of a '50's divorcee turned stand up-comic dominated the comedy category with five awards, including best comedy, best actress, and best supporting actress in a comedy, as well as best writing and directing in a comedy. 

Mixed messages?

This isn't the first time an executive connected to HBO has made disparaging comments about Netflix, and the previous instance didn't work out so well. In late 2010, Time Warner CEO Jeff Bewkes famously said of Netflix, "It's a little bit like, is the Albanian army going to take over the world? I don't think so." We all know how that turned out.

Netflix has led the charge in the changing media landscape, with 130 million subscribers and growing, forcing legacy companies like AT&T and Time Warner to team up in hopes of competing against the growing dominance of streaming services like Netflix.

Jeff Daniels on horseback in a scene from Netflix's Godless.

Netflix original and Emmy Winner Godless. Image source: Netflix.

The stakes are high

This isn't exactly an apples-to-apples comparison. After all, Netflix spent about $6 billion on content last year, while HBO spent just $2.7 billion -- and they won the same number of awards. For comparison, Amazon laid out an estimated $4.5 billion on originals, while Hulu budgeted about $2.5 billion. 

It's important to note that HBO and Netflix have different strategies. Netflix has decades of viewer data that help inform its decisions and spends on programs that would never be considered "award-worthy," but still advance the company's subscriber-focused agenda. As an example, many Adam Sandler flicks have been panned by critics, but Netflix said "his films have found enormous success on Netflix." When The Ridiculous 6 premiered in early 2016, Netflix said it "was the most viewed movie on Netflix in every territory the week of its debut and the most‐viewed movie ever on Netflix in the first 30 days on service." 

Netflix appears to be doing an admirable balancing act, stocking its platform with content viewers love, while garnering an increasing number of industry accolades. Not all of Netflix's programming will win awards, but it doesn't have to.