Netflix Takes Page From HBO’s Prestige Playbook

Emmy race highlights divergent business models among smallscreen heavyweights

In television, the burdensome label “quality” can be a hard sell to audiences. But as this year’s Emmy nominations demonstrate, you can sure as hell market it.

Netflix’s arrival as a player in the Emmy festivities — with a drama series nomination for the political drama “House of Cards,” as well as its stars Kevin Spacey and Robin Wright — underscores and expands on a longstanding trend on TV’s awards circuit, which increasingly separates traditional broadcasters from premium channels and those ad-supported cable networks that have endeavored to carve out their own prestige niches.

Those smaller networks (and in the case of Netflix, a digitally distributed service) are playing a different game, one where audience isn’t monetized in the traditional sense. This enables them to bask in the glow of awards without necessarily translating that into tangible evidence the public is widely embracing their product.

Although “House of Cards” made the biggest splash when the noms were unveiled July 18, perhaps the more symbolic example of this audience-challenged awards halo is “Arrested Development,” a show Netflix brought back from the dead. Three consecutive comedy series nominations and one win weren’t enough to perpetuate the comedy beyond its initial 2003-2006 run on Fox.

SEE MORE: Emmy Nominations Announced: ‘House of Cards’ Makes History

This time around, the Bluth family’s fortunes aren’t tethered to the vagaries of a Nielsen score, but rather an algorithm to which only the brass at Netflix is privy.

Yet if networks still play what amounts to a short game — how many viewers did you attract last night, or (more charitably) amass over the three days of DVR viewing advertisers grudgingly recognize, channels like HBO are pursuing a longer one, promoting an image, and brand, to establish their service as something consumers should want to have.

Even basic cable networks have witnessed the benefits of this kind of branding, particularly when they become embroiled in carriage negotiations with multichannel video program distributors. Sure, the old slogan “I want my MTV” had its day, but when financial push comes to shove, irate fans who want their “Mad Men” or “The Daily Show” fix potentially offer more formidable leverage — and an easier shorthand for the news media to digest and distill into headlines.

The obvious advantage of cablers emphasizing branding is that individual programs don’t have to rely on the demanding ratings criteria broadcasters employ. Witness the HBO series “Enlightened,” which earned two noms (including another for star-producer Laura Dern) even though it was one of those shows almost nobody beyond TV critics made time to watch.

Unlike networks that every year wind up triggering a mini-backlash by canceling some little-seen critical darling, from ABC’s “Happy Endings” to TNT’s “Men of a Certain Age,” HBO had the luxury of sustaining “Enlightened” through two seasons and what at least felt like an ending, before it succumbed to similar gravitational forces.

SEE MORE: Emmys Recognize Digital Age as Netflix Crashes the Party

Netflix execs haven’t been shy about declaring their intent to follow the prestige playbook HBO has used for the past 25 years. In fact, it’s a sign of HBO’s maturation as a business that the critical buzz swarming around “Enlightened” wasn’t enough to keep it alive for another year.

In some respects, Netflix has taken the approach of positioning its shows above the TV fray even further than HBO, recently renewing the women-in-prison drama “Orange Is the New Black” prior to its premiere — a maneuver previously executed by Starz, in part indicating that faith in a show won’t be dictated by something so crass as the level of audience response.

Indeed, Netflix has elevated the haughtiness broadcasters resent about pay cable to another level, including being particularly stingy about releasing concrete data regarding who or how many might be watching its original programs. For those who remain largely shackled to the metric of ratings, this “It’s a hit if we say so” mind-set can be difficult to stomach.

Network executives have chafed at what they see as a double standard, both privately and via conduits like Twitter. They also point out, with some justification, that the challenge associated with churning out two dozen episodes of a successful procedural, a la “NCIS,” doesn’t receive the appreciation it deserves, particularly given how that show’s audiences dwarf any of the Emmy contenders’.

SEE MORE: With ‘Orange Is the New Black,’ Netflix Has Even Brighter Emmy Dreams Ahead

Broadcasters probably don’t earn enough credit for this kind of tonnage. U.S. networks seem to garner more admiration for being prolific from Europeans — who generally produce short-order series — than from media at home, in the same way a sprinter admires a marathon runner’s endurance.

Still, put under the Emmy microscope of honoring creativity, it’s hard to argue, scale notwithstanding, that such episodic network programs match the ambition of something like “Breaking Bad,” which, juggling serialized plots and perishable characters, walks a narrative tightrope that would make Nik Wallenda proud. And the breakout ratings for “The Walking Dead,” “Downton Abbey” and “Game of Thrones” do suggest such storytelling isn’t necessarily an impediment to commercial success, as is sometimes feared.

Ultimately, the estimated $100 million Netflix invested in two seasons of “House of Cards” represents as much a splashy marketing campaign as a play for viewership. And to the extent all the attention functioned as a commercial to pony up for a Netflix subscription, it’s hard to argue the money wasn’t well spent, even before Emmy voters weighed in, inasmuch as the gambit produced front-page coverage in major newspapers — you know, the hard-copy version of those things you read on your iPad.

SEE MORE: VIDEO: The Next Netflix Original Series: ‘Mako Mermaids’

The larger question is whether Netflix and the sundry digital players crowding into original production, laying down bets of various sizes, possess the appetite to continue greenlighting such risky enterprises.

So while Netflix’s Emmy breakthrough can be construed as further evidence that digital production has passed an arbitrary threshold of industry acceptance, it might also signal the first step toward the kind of shakeout that has been commonplace in the past — one that will eventually separate those truly determined to become key players (and inevitably suffer the occasional major flop) from those who retreat or fold the first time their noses get bloodied.

For now, Netflix can enjoy being the newest belle at the Emmy ball — a status that can be as heady as it is fickle and fleeting — unfettered by the public scorecard of ratings in measuring how its programming choices impact its business.

Chalk that up to a shifting media landscape where, unlike the Emmys, it can take quite a while to ascertain who the winners really are.

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