Disney cuts big deal with Netflix

The video subscription service has grabbed the rights to show Disney movies ahead of the pay channels - the first time one of the major studios has bypassed HBO, Starz or Showtime. Under terms of the multi-year deal, Netflix can run Disney movies about seven months after they leave theaters. Netflix will also have access to a catalog of older Disney movies. Terms were not disclosed, but it's likely to be costing Netflix a pretty penny. From MarketBeat:

While Netflix investors are for the moment applauding the company's deal with Disney, the deal likely comes at a price for Netflix, which already faces investor concerns about its programming spending. Financial details weren't released for the Disney deal, but the media giant is a savvy negotiator regarding its properties. ESPN is the most-expensive cable network by far despite commanding a small part of the overall TV audience. Let's see if today's investor enthusiasm stands when the deal's costs begin to show up in Netflix's results.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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