Netflix to get Disney films in TV distribution deal

"This deal brings to our subscribers some of the highest quality, most imaginative family films being made today," Ted Sarandos, Netflix's chief content officer, said in a statement. "It's a leap forward for Internet television."


Movies from Steven Spielberg's DreamWorks Studios are not included in the deal, as that studio distributes its movies through CBS's Showtime on TV. Disney recently signed a deal to distribute DreamWorks' films theatrically after the studio's deal with Viacom's Paramount Pictures expired. The deal allows Netflix to stream Disney movies beginning seven to nine months after they appear in theaters, as Starz does now under Disney's prior agreement. The deal does not cover DVD rentals of Disney movies.

Disney said in November that it would shut down its own video streaming service, Disney Movies Online, which had failed to catch on with users. A message on the 'Disney Movies Online' website said it would shut down on Dec. 31.

Netflix, which started its streaming business with mostly older films, has been moving to add more original programming and produces TV shows such as "Lilyhammer," which stars "Sopranos" actor Steven Van Zandt as an American gangster who starts a new life in Norway. The company also struck a high-profile deal with actor Kevin Spacey for "House of Cards." The Disney pact follows similar deals Netflix has inked for new films with smaller studios, including Relativity Media, The Weinstein company and DreamWorks Animation.

The agreements have saddled Netflix with nearly $5 billion in contractual commitments over the next three years for deals its made for streaming content, the company said in a recent quarterly earnings report.

Netflix's struggles over the last year, which have included missed subscriber guidance, an ill-fated attempt to split the DVD and streaming operations, and a swooning stock price, recently attracted the attention of billionaire activist investor Carl Icahn.

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