While most major Hollywood studios approach Netflix with caution, one production company is embracing the service with an agreement to stream movies just months after their release on DVD.
The deal between Netflix and production house Relativity Media will allow Netflix subscribers to stream several movies during the time that they're usually only available on Pay TV stations such as HBO. It's a small step towards making Netflix's streaming service a more attractive part of the subscription package.
The current problem with Netflix's "Instant Watch" feature is that many of the movies are old. That's because after a film's theatrical release, and after a window where the film is only on DVD or Blu-ray, most studios sell their films to Pay TV stations such as HBO and Starz. This Pay TV window can last as long as a decade. Netflix actually has a deal with Starz to stream some of its movies during the Pay TV window, but it's a fragile agreement that requires the cooperation of movie studios.
By going directly to Relativity, Netflix effectively cuts out the Pay TV middleman, at least for the handful of films Relativity is producing in house. Among those films are "The Fighter," starring Christian Bale, Mark Wahlberg and Amy Adams and distributed by Paramount Pictures, and "Skyline," co-directed by the Brothers Strause and released by Rogue Pictures and Universal Studios. Both films will go to Netflix in early 2011, following a late 2010 theatrical release.
Netflix has made deals with major studios including Warner Bros., 20th Century Fox and Universal Studios, but the implications for streaming video are vague. In all cases, Netflix agreed to delay new releases for its mail-order DVD service by 28 days, while the studios pledged to provide more selections for streaming. But the deal with Relativity deals specifically with upcoming theatrical releases and has nothing to do with Netflix's mail-order DVD business. It's a welcome deal.
