updated 04:40 pm EST, Fri January 15, 2010
Starz negotiations with Disney to affect Netflix
Walt Disney is engaged in private negotiations with cable channel Starz, which is owned by Liberty Media Corp, say sources close to the talks who wish to remain anonymous. The conditions of the deal may mean Netflix is no longer able to offer Disney's movies online. According to the Bloomberg tip, Starz wants five years of access to Disney films on its cable channel and digital rights.
Netflix currently offers Disney movies, which include those produced by Pixar and DreamWorks, thanks to Starz, and Netflix may be forced to reach its own agreement with the studio. The Starz and Disney distribution deal is set to expire in 2012. Starz and Disney need to determine not only how much Starz pays Disney but also whether DreamWorks Studios will be part of the deal.
It is believed Netflix would have a tough time negotiating a favorable deal with Disney, as studios are trying to keep their home entertainment offerings in-house. Warner Bros recently inked a deal with Netflix that would release of its movies through the latter's online service by four weeks. [via Bloomberg]