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House of Cards

The evolution of non-traditional sources for original programming continues. Following the path paved by The Guild, Dr. Horrible’s Sing-a-long Blog, and the recent Hollywood cast YouTube movie, Netflix announced last week that they intend to create a TV series of their own.

Kevin Spacey is slated to star in a political thriller, “House of Cards,” based on a novel about the dark side of British politics. According to Ted Sarandos at Netflix:

We’ve committed to at least 26 episodes of the serialized drama, which is based on a BBC mini-series from the 1990s that’s been a favorite of Netflix members. Originally written as a novel by former UK Conservative Party Chief of Staff Michael Dobbs, “House of Cards,” explores the ruthless underside of British politics at the end of the Thatcher era. Reset against the backdrop of modern-day U.S. electoral politics, this new one-hour drama follows Spacey as an ambitious politician with his eye on the top job.

The executive producer of the series will be David Fincher, fresh off his Oscar nomination for The Social Network. The episodes are slated to “air” in 2012 for customers in U.S. and Canada.

This is a big move for the disruptive media company. Having already successfully migrated from physical DVD rentals to online streaming of movies, the acquisition of an original TV series—technically, Netflix is only agreeing to license the show before it is successfully produced—shifts the perception of the company from a conduit to a source of entertainment. “House of Cards” presumably won’t be available in a movie theatre or via DVR (unless your device is integrated with a working Netflix account). To watch this content, you have to join their club.

Netflix beat out HBO and AMC for the rights to the show. Television industry executives are raising eyebrows, as it is unusual to order an entire season of a show without a pilot episode in the can. Company executives are soft-pedaling the risks. Even with great people involved, though, there is no guarantee of success.

As Fast Company‘s Austin Carr writes:

Remember Studio 60 on the Sunset Strip? The much-hyped NBC series in many ways boasted the same “perfect storm” of talent as House of Cards. The show starred Friends’ Matthew Perry, The West Wing’s Bradley Whitford, Amanda Peet, and was helmed by mythical wordsmith Aaron Sorkin. NBC, so confident in the series’ potential, ordered up (only) 22 episodes before a pilot was even shot. Sound familiar?

After a strong start, however, Studio 60’s ratings dropped off a cliff, and the network cancelled the show after only one season. Netflix is on the hook for two (short) seasons of the show, minimum, whether or not it tanks.

VP Steve Swasey said evidence for the decision to bid came from their existing data. “A lot of this comes from our algorithmically driven software recommendations,” Swasey told Fast Company. “We know what our members like and watch.” Citing other serialized one-hour drama like Heroes, Lost, and Dexter, Sarandos said that this project “represents a manageable risk” and could lead to additional original programming in the future.

Netflix enjoys a 61% share of the U.S. market for digital movies streamed into the home or downloaded over the Internet. A wide margin separates them from #2 Comcast (8% of the market). There are currently 20 million subscribers to the service.