Netflix could be facing an uncertain future if the example being set by Showtime is followed by others. Content is becoming more expensive and potentially unavailable altogether as media companies start waking up to the possibilities streaming video offers.
Showtime Stiffs Netflix
suggested this week that when its existing licensing agreement with Netflix concludes in the summer, it would no longer be offering its first-run series such as Dexter and Californication on the streaming service. Instead it wants to use these popular shows to entice new subscriptions.
Netflix issued a statement saying:
“Netflix may or not renew with Showtime. Titles expire and migrate on and off Netflix [as] part of the ebb and flow of licensing.”
There have been suggestions this is merely a bargaining position CBS is taking ahead of negotiations, but I suspect it runs a little deeper than that.
An Uncertain Future?
may be a little blase about this development, at least in public, but it knows what we know, which is that the company needs content, and good, new content at that, in order to keep growing as it has been over the past few years. If that content suddenly isn’t available, or is made too expensive for Netflix to afford, then an uncertain future will emerge for the company.
The problem for the studios and networks is that they’re torn between protecting the past and forging the future. On the one hand selling content to Netflix cannibalizes their own businesses, but on the other they need to be involved with these emerging leaders in the online video sector or risk being left behind as the rest of the world moves on.
Conclusions
Showtime seems keen to straddle the fine line between keeping hold of its precious content until it has wrung it dry of profit while maintaining some sort of relationship with Netflix with an eye to the future.
I don’t blame them for doing so, and I can see others following suit. But for Netflix this could be an expensive development that ultimately harms its business. So I guess it’s a good thing it’s seeking alternatives and seeking to become a broadcaster in its own right.
[Via NewTeeVee]
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