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re: Netflix Loses Starz Deal, Stock Crushed In After Hours Trading
Posted on 9/1/11 at 4:45 pm to Tiger JJ
Posted on 9/1/11 at 4:45 pm to Tiger JJ
quote:
I find these streaming deals to be really confusing. Disney comes through Starz?
Rember, Starz is a cable movie channel. They have deals with Sony, Disney, etc. for their content. NetFlix's deal with Starz had given them access to those movies but Sony had an out clause that let them pull their movies off of NetFlix if they reached something like 22 Million subscribers. Disney has a similar out clause but I'm not sure what the subscriber number is. Sony wants its movies on NetFlix and so does Starz, but they want to get paid a lot more for it. NetFlix really doesn't have a choice. I think the previous deal was about $30 million per year and they're probably going to have to go close to $300 million per year to keep Starz, Disney and get Sony back.
2
Posted on 9/1/11 at 4:52 pm to TigerinATL
quote:
Sony wants its movies on NetFlix and so does Starz, but they want to get paid a lot more for it. NetFlix really doesn't have a choice. I think the previous deal was about $30 million per year and they're probably going to have to go close to $300 million per year to keep Starz, Disney and get Sony back.
That's understandable but Netflix is in effect the main vehicle through which movie/tv steaming takes place right now. To cut that off without offering an alternative is just going to alienate the consumer. Cutting off the nose to spite the face...
Put it this way. I know the music industry wanted to bend Apple over at first, but I'm 32 years old and came of age during the boom of napster and birth of broadband. I pay for every single album that I own because of the ease of Itunes.
Posted on 9/1/11 at 4:52 pm to TigerinATL
Last year an analyst published a report that Netflix should either buy or buy into controlling Starz to prevent this.
I agree that it has to be a negotiating tactic. If Starz stops doing business with Netflix, there is no other outlet nearly as large to attempt replacing that lost revenue with. There are many small fragmented options but Netflix is already embedded in millions of devices and has a huge customer base.
I see either a deal being done or Starz losing it's contract to distribute future movies for some studios.
I agree that it has to be a negotiating tactic. If Starz stops doing business with Netflix, there is no other outlet nearly as large to attempt replacing that lost revenue with. There are many small fragmented options but Netflix is already embedded in millions of devices and has a huge customer base.
I see either a deal being done or Starz losing it's contract to distribute future movies for some studios.
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