Why Netflix Can Do Better Than CBS

With Amazon (NSDQ: AMZN) finally throwing its hat in the ring into the subscription-video business today, it was nifty timing on Netflix’s part to announce a new content pact, for TV shows from CBS (NYSE: CBS). But this deal really isn’t a big deal.

At first blush, it sounds swell: CBS is currently the most successful broadcast network. But little from the primetime schedule is part of this two-year, non-exclusive deal, except for the just-canceled Medium and CBC-produced drama Flashpoint.

The rest of the agreed-upon content, which hits Netflix in April, is cobweb-heavy library material: The Twilight Zone, The Andy Griffith Show, Family Ties and Cheers, to name a few.

That’s all well and good for Netflix to build itself up into the ultimate destination for long-tail content. But there’s plenty of programming much farther up the tail that still has yet to make it onto Netflix (NSDQ: NFLX).

Consider Netflix’s last notable TV deal, for ABC (NYSE: DIS) and Disney Channel series that were just 15 days away from their initial airdate. That deal signaled there was a vast middle ground to explore between the kind of day-after programming reserved for VOD and the ancient likes of Cheers, which has been through so many TV syndication cycles at this point that its value is quite diminished.

Even more valuable than that kind of not-quite-stale-yet programming is a certain type of show: serialized dramas, which are perfect for the Netflix users who wants to catch up on series they might have missed in their entirety. While these kind of shows are not worth much in syndication, which prefers episodes that can be shown out of order, the streaming rights to critically acclaimed shows like Dexter (only its first two seasons are streaming on Netflix) from CBS Corp.-owned Showtime are more valuable to Netflix.

For all its success, CBS hasn’t scored much with series outside of the procedurals like the CSI and NCIS franchises, which are very lightly serialized. If Netflix really wants to make its TV portfolio a more compelling proposition, it needs to steer clear of detective shows and series too old to remember.