Recently, Netflix has announced a possible deal with the startup paid-TV channel Epix. This deal would give Netflix the exclusive online rights to films from its three equity partners – Paramount Pictures, Lionsgate, and MGM. The deal would also allow Netflix subscribers to watch movies such as “Iron Man 2,” “Dinner for Schmucks,” and “The Expendables” through the company’s interent streaming service.
As more people have started watching Internet content on their television sets, Netflix has put a lot of resources into their Internet streaming video services. This could lead to Netflix becoming a potential threat to Time Warner’s dominant pay channel HBO. It is expected that the agreement would allow Paramount, Lionsgate and MGM to sell and rent their movies via digital stores such as Apple Inc.’s iTunes, a privilege that HBO doesn’t
give its studios.
There is still a lot of agreements that need to be settled between the two companies, but the deal is expected to cost Netflix over $1 billion over a 5 year time period.
[LA Times]