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Netflix, Inc. Is Copying... Starz?

By Tim Beyers – Feb 11, 2014 at 6:00PM

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First, Starz orders two seasons of "Black Sails" before the series premiere. Now, Netflix has ordered a third season of "House of Cards" before this week’s season two debut.

 

Good news, marathon viewers! You'll have more to look forward to after binge-watching the new season of House of Cards, which goes live on Netflix, Inc. (NFLX -0.50%) this Friday. A season three order is already in the works.

But is it a smart investment for the company, which is still a relative newbie as a producer of original series? Among competitors, only Starz (STRZA) has been so bold, ordering two seasons of Black Sails ahead of January's series premiere. In the video above, Fool contributor Tim Beyers explains why he likes Netflix's aggressiveness.

First, House of Cards has established its bona fides during awards season having won three Emmys and a Golden Globe for Robin Wright, who took home honors as best actress in a television drama. The ensuing buzz has cemented the show as Netflix's signature property. Tim says it's likely at least 2 million to 3 million viewers watched the first season of the series when it aired last February.

That alone would probably be enough to get Chief Content Officer Ted Sarandos to ink a new deal, yet there's also a second dynamic to consider. Hollywood is locking up talent earlier and more often when it comes to signature properties. In booking a season three now, Netflix gets to tease its subscriber base while also guaranteeing that the show's principal players don't get embroiled in conflicts before pre-production begins, Tim argues.

Now it's your turn to weigh in. Will you be binge-watching House of Cards this coming weekend? Do you agree with the strategy of ordering a season ahead? Please watch the video to get Tim's full take and then leave a comment to let us know whether you would buy, sell, or short Netflix stock at current prices.

Kevin Spacey stars in House of Cards, which returns for a second season on Feb. 14.
Image source: Netflix.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Apple, Google, and Netflix at the time of publication. Check out Tim's web home and portfolio holdings or connect with him on Google+Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool recommends and owns shares of Apple, Google, and Netflix. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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