Netflix Inc. (
will stream the second season of its original horror series
in 2014, produced by Gaumont International Television. The second
season will consist of 10 episodes and is expected to go into
production later this year.
is a horror thriller that unravels the mysteries of a small
Pennsylvania town. In the second season, Charles H. Eglee (of
The Walking Dead
fame) will join the series as executive producer.
The first season of
did not receive as much appreciation as Netflix's other original
shows such as
House of Cards
received mixed reviews from critics and was reportedly a flop in
terms of viewership.
In such a scenario, a second season comes as a surprise to many.
However, we believe that Netflix is targeting a particular group
of audience through its choice of productions. Through its
original television shows, Netflix has been venturing into
different genres like comedy, political thrillers,
autobiographies and horror.
For instance, Netflix's partnership with
DreamWorks Animation SKG (
will help it to reach out to kids through an original series,
Turbo: F.A.S.T. (Fast Action Stunt Team). This original series
will be available for streaming from December in the U.S. and
Both the companies recently signed a new deal, which will
allow Netflix to stream over 300 hours of new programs based on
characters from DreamWorks' portfolio of popular films. Netflix
will air these shows in 40 countries beginning 2014.
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In March, Netflix commissioned a sci-fi show called
, which will bring together the Wachowskis (creators of
trilogy) and J. Michael Straczynski (the creator of television
) for the first time.
Netflix's growing offerings in the original program series is
expected to diversify its online content and help it stand out
among other streaming content providers such as
, HBO, Hulu and
Comcast Corp (
We believe that these initiatives will be incrementally
beneficial for the company, helping it to add new subscribers and
retain the older ones, going forward. This is indicative of the
fact that in the last-reported quarter, Netflix added 2.03
million streaming subscribers in the domestic market and 1.02
million subscribers in the international market.
However, higher costs owing to international ventures and
licensing fees and continued subscriber losses in its DVD
business are near-term headwinds. Loss from the international
business, due to higher content and marketing costs, is another
concern in the short term.
Nonetheless, we believe that new streaming content deals and its
original content portfolio should be able to attract new
subscribers both in the U.S. and international markets.
Currently, Netflix has a Zacks Rank #3 (Hold).