Disney opens its vault for Netflix
Disney fans have been waiting for classics such as 鈥淒umbo,鈥� 鈥淎lice in Wonderland,鈥� and 鈥淧ocahontas鈥� to appear on Netfix. Now, it鈥檚 finally going to happen.
Walt Disney Studios decided not to renew its agreement with Starz, the聽premium cable channel.聽Instead, it plans to show its films from Disney,聽Pixar, Marvel, and Lucasfilm on Netflix. Classic Disney films will be available immediately on Netflix, while new releases will not begin streaming until after the existing deal with Starz expires in 2016.
The deal will allow Netflix to stream Disney new releases seven to nine months after the films appear in theaters, the same deal Disney made with Starz. Movies from Steven Spielberg鈥檚 DreamWorks studios are not included in the deal, as it distributes its movies to TV through CBS鈥� Showtime, Reuters .
The deal also gives Netflix first-run rights to Disney鈥檚 direct-to-video releases, starting in 2013.
Disney is the first of the Hollywood big six that chose Web streaming over pay television.
Ted Sarandos, Netflix鈥檚 chief content officer, called the deal 鈥渁 bold leap forward for Internet television,鈥� The New York Times .
Because of this deal, starting in 2016, Disney鈥檚 new releases will be available on Netflix during what鈥檚 known as the .聽This is the time that paid television networks, such as Starz, Showtime, and HBO, offer new releases to their subscribers. However, the licensing fees in order to do this are steep. Netflix is aggressively taking over the pay-tv business by offering more profitable terms through its increasingly popular streaming methods.聽
Since the deal was made, Netflix shares have jumped 14.01 percent to $86.65. Disney has increased by 0.02 percent.
According to The New York Times, Starz issued a statement saying they broke the deal with Disney, not the other way around.
鈥淥ur decision not to extend the agreement for Disney output past that time allows us the opportunity to implement our plan to dramatically ramp up our investment in exclusive, premium-quality original series which will best meet the needs of our distributors and subscribers,鈥� the company said in the statement.
What this means for Starz in unknown. But 鈥渁nything that increases the marketplace clout of Netflix is damaging [to them],鈥� Brooks Barnes of The New York Times.
