updated 02:35 pm EDT, Wed October 27, 2010
Netflix paying $1.2 billion in streaming rights?
Netflix' recent moves to bring its content online only rather than its traditional method of mailing out DVDs is costing the company a minimum of $1.2 billion, according to an SEC filing from yesterday. Thfee would cover the streaming rights for the movies and TV shows to Hollywood studios. The price is a marked increase from the $229 million Netflix spent on rights three years ago.
A large portion of that number, estimated at between $900 million and a billion dollars, was spent on a five-year deal with pay channel Epix. The agreement would expire in 2011, though a renewal is likely, as Netflix receives its Sony and Disney content from the company. At least one analyst, Barclays' Douglas Ammuth, believes the company will have $2 billion in costs for streaming rights by the end of 2011. [via AllThingsDigital]