Will Kevin Spacey's Pricey 500K Salary Pay Off For Netflix?

Per a recent report, American actor, Kevin Spacey is being paid an astronomical sum of $500,000 per episode for his role in Netflix's (NASDAQ:NFLX) original TV series House of Cards.

The aforesaid figure includes Spacey’s fees for lending his services to production as well as his share in the profits. It places Kevin Spacey among some of the top earning network stars worldwide who are paid more than $500,000 per episode, which includes the likes of Mark Harmon ($625,000), John Cryer ($650,000) and Ashton Kutcher ($750,000).

The House of Cards series derives its title from a novel with the same name and is about a British politician who desires to succeed Margaret Thatcher as the British prime minister. Media Rights Capital is the producer of the show and David Fincher, the director as well as the executive producer. Kevin Spacey not only stars in the series but is also the executive producer.

The first as well as the second season of the drama series, each comprising thirteen episodes were premiered on Netflix in Feb, 2013 and Feb, 2014 respectively. The third season is set to be streamed on Netflix in 2015.

For the first season, the drama series received nine Primetime Emmy award nominations while for the second season, it received thirteen nominations.

The annual Emmy awards recognize the best shows and talents in the television industry similar to the Oscars in the movie industry. In such a scenario, we believe that a number of Emmy wins will beef up Netflix’s competitive position against the likes of HBO as well as new entrants like Amazon.com Inc (NASDAQ:AMZN).

We believe that Netflix’s decision to rope in Kevin Spacey for the role of the male protagonist in the drama series has helped it draw a larger audience and thereby boosted profitability.

Of late, Netflix has been endeavoring to rope in celebrities in an attempt to enhance its reach. Netflix recently signed a deal with comedian and actress Chelsea Handler to create a new talk-show slated for a 2016 release. The deal also includes a stand-up special coupled with four docu-comedy specials, all featuring Chelsea.

Netflix’s partnerships with major film studios and production houses like CBS Corporation (NYSE:CBS), Sony Pictures, The Weinstein Company and Walt Disney Company (NYSE:DIS) are also expected to further expand its content library in the long haul.

Although we believe that a fast growing subscriber base will drive the top line this year, rising content costs and expenditure related to international expansion are major headwinds,

Currently, Netflix has a Zacks Rank #3 (Hold).

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