Netflix Adds Chelsea Handler to Its Programming Arsenal

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Mark Lennihan/AP
One thing that has kept Netflix (NFLX) a hit is that it never seems to rest.

The leading premium streaming service has grown to 48.35 million global subscribers as a result of its growing content library, and it invests in its digital vault to protect its dominance, knowing that no one can compete with it on a cost-per-subscriber basis. This doesn't mean that Netflix has it all. Amazon.com (AMZN) has been scoring some impressive exclusive deals for magnetic content. However, when it comes to proprietary programming, no streaming service comes close.

It's been just two years since Netflix began offering exclusive shows. "Lilyhammer" generated a modest amount of buzz in 2012, but it all came together last year with "House of Cards," "Orange Is the New Black" and the "Arrested Development" revival.

Handler with Care

Netflix last week announced a long-term content deal with Chelsea Handler. Come October it will be Handler in a stand-up special that will stream exclusively on Netflix. Next year it will be four comedic documentary specials with Handler skewering politics, the NBA draft, NASCAR and Silicon Valley.

The big prize awaits in 2016 when Handler will host Netflix's first proprietary talk show. This is familiar territory for Handler, given the success of "Chelsea Lately" on E!, where she blends comedy with guest interviews. In a world where the major networks have flocked to male hosts for their late-night shows, Handler stands out in refreshing way.

However, "Chelsea Lately" ends in August, freeing her up to stretch the boundaries of what streaming television can achieve. "If I was going to continue working in this industry, I knew I had to do something outside the box to keep myself interested," she said in the release announcing the deal. "I wanted to sit with the cool kids at lunch, so I approached Netflix to make sure they were as cool as I thought they were, and when I confirmed my suspicions, like with any other future lover, I made my move."

Taking Another Page Out of the HBO Playbook

A late-night talk show that's exclusive to a premium video service should sound familiar. It's something that Time Warner's (TWX) HBO has been doing for a long time. "Last Week Tonight with John Oliver" is Its latest foray, and the Sunday night show has already unleashed a few viral video sensations with Olver's rants on net neutrality and FIFA with just a few weeks under its belt.

If Handler's talk show is successful, the timely content will be a game changer for Netflix. The downside, of course, is that the content won't have the same staying power as traditional programming. Handler having a laugh at a recent celebrity's faux pas or bringing on a starlet promoting a new movie won't be as compelling to watch months and years later. It's not like "House of Cards," which should remain fresh to first-time viewers for several years.

However, Netflix has done a great job of building up its serial dramas. Now it can use a weapon that riffs on what's trending. It has that in Handler, even if Netflix will have to wait two years to see this content deal begin to pay off.

Motley Fool contributor Rick Munarriz owns shares of Netflix. The Motley Fool recommends Amazon.com and Netflix. The Motley Fool owns shares of Amazon.com and Netflix. Try any Motley Fool newsletter service free for 30 days.

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