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Summary:

Blame it on the holiday season, when kids make overly ambitious lists of all the gifts they want for Christmas. But if it’s true that Netfli…

Netflix DVD
photo: Corbis / Bryan Snyder

Blame it on the holiday season, when kids make overly ambitious lists of all the gifts they want for Christmas. But if it’s true that Netflix (NSDQ: NFLX) thinks it’s going to get its hands on the newest episodes of primetime TV shows, that’s pure delusion.

That’s the word from The New York Post, which claims Netflix is offering $70,000-$100,000 per episode as long as they can get hit shows “in season.”

Netflix may seem capable of anything given they haven’t been denied much on its current shopping spree. The ink is barely dry on its new deal with FilmDistrict, which will grant Netflix its first-ever cache of films in the pay-TV window. And Netflix already managed to get itself an in-season TV deal for episodes of Saturday Night Live the day after they air on NBC (NYSE: GE) as part of a broader deal with the broadcaster in September.

But for hit primetime series like Glee or NCIS to appear on Netflix the day after they air? Don’t bet on it.

What is so easily forgotten amid all the well-earned hype about Netflix is that for all its many movies, that library has nowhere near the drawing power of primetime programming. Those who own those programs are not going to make deals that would empower Netflix or anyone to exhibit current programming on TV sets in proximity to first-run windows, where advertising dollars are at stake, or even mess with same-week viewing opportunities via VOD and DVR. It’s the same logic that drove the broadcasters to push back on Google (NSDQ: GOOG) TV, which is far less a threat at this juncture than Netflix.

That’s why Netflix’s library of TV programming is for the most part previous-season catalog fare, like the deal struck in January with Warner Bros..

That said, you might see a low-profile primetime show get an in-season deal with Netflix for no other reason than the broadcasters want to test just how big a bite the service could take out of its hide, using a program of little value, i.e SNL . Or perhaps a broadcaster will stretch the definition of “in-season” and allow an episode that ran months earlier to get a shot on Netflix. But that’s all in the spirit of experimentation.

$100,000 an episode may seem like a lot, but it’s not when you put it in perspective of TV’s syndication marketplace, where top shows fetch millions per episode. Overexposing shows in advance of their move to syndication or DVD would dilute their value to those crucial windows.

The Post mentions that this is a “war” over this issue brewing between the networks and studios, which is a little hard to believe. Not that these two factions don’t have their disagreements, but considering most of them are owned by the same conglomerate, they both have a vested interest in protecting the current windows and playing defense against Netflix.

A more accurate picture of how content companies view Netflix is coming out of the Reuters Global Media Summit this week, where the prevailing attitude toward the company is one of regret. Deals like the $30 million movie cache Starz made have given rise to a new competitor, one they’re going to try to weaken at every turn in the coming year, whether it’s the extortionate renewal fee Netflix likely faces for that Starz deal or an extension of the 28-day window.

“It’s hard to see how that kind of economics can fit into a service that charges $8 or $10 a month because the math doesn’t work,” Time Warner (NYSE: TWX) CEO Jeff Bewkes told Reuters on Wednesday.

If the math doesn’t work, Netflix won’t be looking to the likes of Time Warner for much help.

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  1. I guess this is good news for me as a NetFlix subscriber, but I can’t see how NetFlix is going to beat Hulu at this game when Hulu is owned by TV studios. And if NetFlix is paying $100,000 per new episode, it’ll be less profitable and less able to buy movies, so I guess we’ll be seeing less “net” and/or fewer “flix.”

    An internet video company has to find a good niche and dominate that niche in order to be profitable, just like in a lot of other markets. I work for an internet video service (www.fargotube.com) and I can tell you that we’re not trying to outdo NetFlix or Hulu at their own games. We’re carving out a niche in video-based fan sites for musicians, small-scale filmmakers and video-based instructors.

  2. The Post mentions that this is a “war” over this issue brewing between the networks and studios, which is a little hard to believe. Not that these two factions don’t have their disagreements, but considering most of them are owned by the same conglomerate, they both have a vested interest in protecting the current windows and playing defense against Netflix.

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