With three Emmy statuettes now on its mantle, this should be a carefree time at Netflix. Were it only that simple.

A Wall Street Journal story hit last Friday suggesting pay-TV providers intend to compete for rights to TV series that Netflix and other subscription VOD services have exploited to establish themselves as destinations for binge-viewing. 21st Century Fox and Comcast are said to be on the verge of one deal in particular that could steer select series to the cable operator, which wants to expand its VOD beyond the typical handful of most recent episodes to the territory Netflix has made its specialty.

This is a significant development for Netflix. The prospect of pay-TV distributors beginning to lure sizable amounts of premium content away from Netflix in the coming years poses an existential threat to the streaming service. Netflix will have to maintain a tricky balance between the catalog supply that has long been its core offering and the original content the company has done an admirable job of layering on top of that.

Think yanking the tablecloth out from under the silverware…but in slow motion.

That leaves a twofold question. Can Netflix outbid the distributors for the rights to enough library content to stay viable in the marketplace? Or is that an outmoded definition of viability given library content may not matter as much to Netflix in the near future given its Emmy-winning success in original programming?

If plans to ramp up at least 20 series per year beginning in 2014 struck you as a tad ambitious, the Comcast-Fox news may give good reason for the overreach: Netflix needs to become more reliant on original programming quicker than anyone might have realized because the licensed library content on which the service built its popularity could erode.

Keep in mind this ebb and flow isn’t necessarily inconsistent with the Netflix long game; the point has always been to play the HBO playbook, which means leading with original programming. But where this gets tricky for Netflix is that it will have to evolve from licensing library to funding original content much faster than HBO, doing in a matter of years what the Time Warner-owned channel had the luxury of doing over decades.

The pressure to wean off licensed library content likely isn’t a predicament that snuck up on Netflix, which surely began hedging its bets on original programming last year when it made an expensive deal to snap up Disney film titles beginning in 2016.

But it’s quite possible that as more and more originals are made available, Netflix could sustain itself with just a few key library deals like the Disney one. The company has already repeatedly asserted that it will be more selective about those library deals as its audience data provides a more nuanced understanding of what content is actually worth. So there’s no longer a need to boil the ocean, which was essentially Netflix’s catalog strategy for its first few years in the streaming business.

A pact like the Disney one needs to be kept in mind should a Fox-Comcast deal be the first of many that removes big chunks of licensed content from Netflix. The sheer tonnage of the exiting content could trigger mistaken assumptions that the company will consequently be thrown for a loss, as it did last year when Netflix let a deal expire on over 800 hours from A&E Networks.

For Fox to be leading the charge here isn’t entirely surprising. This is the studio that has been talking the biggest game over the years on the authentication front, putting as much value behind the walls of its pay-TV partners as possible.

But on on the other hand, Fox may also know better than anyone else the value of Netflix as a buyer, too. 20th Century Fox was the first major studio to produce original content for Netflix via “Arrested Development.” And while the rush may be on to move content en masse to pay TV, even Fox knows that Netflix is the better place to fish where the fish are in support of driving on-air audience. 20th Century Fox did a deal a few months ago to put the first two seasons of comedy Fox comedy “New Girl” on Netflix.

And therein what may lie the crux of the conflict between distributors and studios. Should distributors have to pay much more–if anything–if the binge viewing provides a boost to on air? Maybe studios should being paying distributors instead of the other way around, a notion I floated last month when crediting Netflix for driving record audiences to the latest season of “Breaking Bad.”

And yet even though distributors in the WSJ story went on the record with a hard-line negotiation stance suggesting their ability to boost on-air programming means they should pay next to nothing for TV rights, it’s understandable why conglomerates like CBS Corp. and Disney aren’t playing ball as long as companies like Amazon and Netflix are around to overpay when Comcast and Verizon aren’t feeling as generous.

But going for the easy money could amount to a dangerous game. If congloms keeps feeding Netflix, those revenues could come at the expense of the distributors who may eventually start to succumb to cord-cutting as SVOD options get stronger. That would endanger a much bigger revenue stream given affiliate fees are the biggest gravy train Hollywood has.

The timing of this this pay-TV incursion is also interesting because it comes so closely on the heels of a unprecedented sign of detente between Netflix and pay-TV incumbents. Earlier this month in the U.K., Virgin Media became the first cable operator to make Netflix available on a set-top box. Hastings himself once raised the prospect that Netflix could be bundled with U.S. cable operator offerings, but nothing has yet to materialize in the marketplace to suggest that is happening.

It is entirely possible that these are not disconnected developments. Cable operators may have wanted to use Netflix to plug the SVOD hole in their offering but didn’t like the terms they were getting. Now they’re putting the screws to Netflix by having its content partners attempting to bid away its catalog content.

Maybe a deal or two puts enough pressure on Netflix to get back to the negotiation table with more favorable terms. Or maybe the distributors have given up on bundling Netflix, which means it could be time to rip away the streaming service’s core offering in catalog TV assets and shift them to pay-TV providers.

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