Is This How Netflix's House of Cards Falls Down?
No, I don't think that Netflix (NAS: NFLX) , the company, has a budget issue. The company is not about to collapse like a proverbial house of cards, crushed by impossible content payments. As long as Netflix keeps adding a healthy dose of new subscribers every quarter, this budget will work just fine. And in case you missed the last earnings announcement, that's exactly what Netflix is back to doing.
The newsworthy budget issue today comes from The Hollywood Reporter saying that award-winning director David Fincher might walk away from House of Cards. The political drama would be in trouble without Fincher, who is scheduled to direct the first two episodes and also serves as executive producer for the 26-episode series. And it's a big deal for Netflix, which signed exclusive first-run rights to the drama in a bidding war with AMC and Time Warner's (NYS: TWX) HBO.
Of course, nothing is ever as simple as it seems in Tinseltown. Hollywood Reporter cites "multiple sources" relaying that Fincher wants more money for his involvement in the project, which would break producer Media Rights Capital's $100 million budget. But the same article concedes that Netflix has no comment on the alleged issue, while Media Rights insists that everything is hunky-dory. "Everything's fine and moving ahead," in the company's own words.
Besides, Fincher's brand-name involvement is probably less important than that of series headliner Kevin Spacey, who also works as a producer. And whether or not Media Rights boosts Fincher's paycheck, I'm sure the project gets done. Media Rights is a small company that hardly can afford to let a major contract like this slip through its fingers, especially only weeks before filming starts. And either way, Netflix doesn't pay another dime. If anything, there'd be a refund check coming back from a canceled project.
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At the time this article was published Fool contributor Anders Bylund owns shares of Netflix but holds no other position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Check out Anders' holdings and bio, or follow him on Twitter and Google+. We have a disclosure policy.
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