Netflix To Lose Starz Content Just As Prices Increase
Netflix have had a golden period recently, but may just be hitting their first real rocky patch. After the unpopular price increase has just kicked in, news comes that the deal with Premium cable network Starz who are an important content provider is coming to an end.
Netflix to lose Starz streaming
The Starz streaming deal finishes in February 2012, but according to Netflix it is no big deal as Starz content was only accounted for 8% of its mainstream content and now that it has more content providers.
But they seem to underestimate just how popular that small 8% was. Starz who signed the current agreement in 2008, control the rights to movies coming from from Walt Disney and Sony Pictures.
Starz said in a statement, “When the agreement expires on February 28, 2012, Starz will cease to distribute its content on the Netflix streaming platform.” The two companies were thought to be thrashing out a deal, but it seems to no avail, Starz say they took the decision to ensure its content wasn’t undervalued.
It seems that Starz are very worried about cord cutters leaving them for Netflix who have grown from a niche/nerdy audience when the current agreement was signed, to a massive 25 million subscriber service today.
This is not the first time Starz have had a run-in with Netflix, they imposed a 90 day waitbefore allowing them to stream TV and movie content back in March. They hoped the move would convince more users to subscribe to their own Internet TV hub, Starz Online.
Netflix users still obviously have a great deal of content from Paramount, MGM and Lionsgate movies, as well as the many ongoing content deals they are thrashing out. And they would probably argue (if they had bothered to comment), that losing and gaining content is what makes the streaming world go round.
The announcement saw Netflix stock dropping and with the news that many Netflix customers are desserting them for other streaming services including Vudu, Netflix execs may be starting to sweat a little.
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