Netflix strikes deal with ABC-Disney, building Internet video library
Netflix Wednesday announced a licensing deal with Disney-ABC Television to stream hundreds of shows and movies such as "Ugly Betty" and "Desperate Housewives," building on the online television provider's growing library of content.
Subscribers of Netflix's monthly Internet streaming membership, which is competing directly with cable and satellite television services, will have access to those shows but no earlier than 15 days after their initial telecast, according to a release.
The race for to deliver videos over the Internet has pitted newcomers such as Google TV, Apple TV and Hulu against powerful cable, satellite and telecom services that for years have become the main source of television access.
Netflix has emerged as the biggest threat to those firms, according to analysts, and has done so by brokering deals with programmers such as a $1 billion contract with MGM, Lionsgate and Paramount to stream movies to subscribers the same day they hit theaters. Already, about 20 percent of all residential broadband traffic during peak hours at night is from consumers watching Netflix videos, according to Sandive, an analytics firm.
Time WarnerCEO Jeff Bewkes on Tuesday downplayed the threat of Netflix, saying content creators won't be willing to take low licensing fee offers from the company, according to a report by The Hollywood Reporter. He said "Large aggregation at a low price is not particularly useful" to content creators or consumers.
The deal includes past episodes of "Grey's Anatomy," "Desperate Housewives" and "Brothers & Sisters." Every episode of "Lost" and "Ugly Betty" also will be included. Disney Channel shows like "Phineas and Ferb" will also be streamed to Netflix users.
"Adding to our existing Disney-ABC lineup with great network and cable shows, and opening up ABC Family for the first time, are important steps in creating a wide and diverse selection of content Netflix members of all ages can watch," said Ted Sarandos, Netflix's chief content officer, in a news release.
Another threat to Netflix could be a move by the Federal Communications Commission to bless usage-based pricing from Internet service providers. That policy could make online video streaming -- which gobbles up bandwidth -- less attractive for consumers.
| December 8, 2010; 10:45 AM ET
Categories: Comcast, FCC, Google, Net Neutrality, Online Video
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