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'House of Cards' trumps UK OTT rivals for Netflix

While firm data is elusive, there are signs that Netflix is enjoying a surge in subscriptions in the UK, on the back of its political drama, "House of Cards", which has also gone down well the other side of the pond.

The reaction is such that CEO Reed Hastings recently remarked that the original series “met all expectations in becoming a great success," although without giving any figures. This was because Netflix does not know yet what the final impact will be on subs, certainly not in the UK where it has been offering all 13 episodes of House of Cards at once in one big binge sweetened further by the usual month-long free trial. This means that Netflix will have to wait at least a month until the dust has settled to find out how many of these House of Cards addicts reward the operator by staying on as paid subscribers. Writer for the New Statesman magazine Rachel Cooke stated in her column that having been hooked on the House of Cards she is very unlikely to stay after the free month is over, and she can probably afford it more than many.

Netflix is targeting the more prosperous viewers of the UK’s Free To Air Freeview digital terrestrial service who have so far avoided subscribing to one of the three main pay TV services from satellite operator BSkyB, MSO Virgin Media, and hybrid DTT/IPTV operator BT Vision. The hope is that they might be tempted by the promise of a continual supply of original content as well as movies and other TV shows to top up their Freeview service with a Netflix subscription of £6 ($9) a month, compared with around £40 or more for a full pay TV package.

Whatever happens from now on, House of Cards will be adjudged a success by hitting the right note for such a series, being compulsive and slightly sinister but not too demanding, following a proven formula adopted in the UK with the series of the same name broadcast by the BBC two decades ago in the wake of prime minister Margaret Thatcher’s removal from power through an internal party coup. That series leant heavily on the performance of leading actor, the late Ian Richardson, playing the Machiavellian conservative politician Francis Urquhart. Similarly the success of the Netflix version is very much down to Kevin Spacey as John Underwood.

The plots are also eerily close, complete with vituperative soliloquies and asides to the viewer, as well as the catch line immortalized by Ian Richardson that has almost become a cliché in the UK, “You may very well think that; I couldn’t possibly comment.”

There are though a few American idiosyncrasies in the Netflix series, like Underwood’s fondness for BBQ ribs, which he devours for breakfast, before picking remaining pork detritus from his teeth afterwards. Having struck the right note Netflix is aware it must keep on running and keep its new subscribers on board with a continual roll of original content. Next up in April is a very different series, a horror show called Hemlock Grove. While Hastings tried to downplay the idea of Netflix becoming known as a content creator rather than distributor, he did emphasize that original material was crucial for growth. It is the only way Netflix can complete its transition from being a leading OTT player but at the margins of TV into a major TV service provider.

It is notable that traditional pay TV operators are turning to original content alongside rights acquisition if they are not there already. In the UK Virgin Media appeared to be an exception, enjoying modest subs growth after washing its hands of content altogether. But then it was taken over by Liberty Global, which has its own content division called Chellomedia turning over almost $500 million a year.