Netflix’s (NFLX) new original series Derek will be available for streaming from Sep 12, 2013. Netflix subscribers across all its operating markets, barring the U.K., will be able to stream all seven episodes. The show is being produced by Derek Productions Ltd.
Derek is a comedy-drama featuring David Earl, Karl Pilkington and Kerry Godliman. The protagonist, Derek, is being played by Ricky Gervais. Gervais has been accredited with three Golden Globes, two Primetime Emmys and seven BAFTAS for penning and starring in various shows, particulary The Office and Extras.
The story of Derek revolves around the protagonist and his colleagues, who work in a retirement home, and the home’s residents.
Apart from Derek, Netflix has a host of original series lined up for release this year and the next. The fourth season of Arrested Development is set to be released on May 26. New episodes of Orange Is the New Black are slated for a summer release. Later this year, season two of Lilyhammer will also be available for streaming.
Moreover, Netflix has collaborated with DreamWorks Animation (DWA) to stream an original series, Turbo: F.A.S.T. (Fast Action Stunt Team), exclusively for kids.
Netflix’s growing offerings in the original program series is expected to diversify its online content and make a mark for itself among other streaming content providers. 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 entice new subscribers in the U.S. as well as the International markets. Moreover, these will help the company to withstand stiff competition from other service providers such as Amazon (AMZN), HBO and Comcast (CMCSA).
Currently, Netflix has a Zacks Rank #2 (Buy).
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