Wednesday, October 1, 2008

Netflix Picks Starz's Online Movie Service

Starz has broadened its distribution by signing a three year deal to offer its films through the Netflix service. And while these titles are primarily seen on a PC, Netflix's deal with Roku means that these same films can be seen on your TV. SO how do the cable companies feel about this. Will cable customers who have Starz cancel their subscription and get their movies through their Netflix subscription. In fact a Netflix subscriber now has more flexibility about where they watch their movies DVD player, Roku player, or PC. Companies like Verizon have also signed distribution deals with Starz; perhaps with consideration to also offer mobile downloads as well.

"Starz last month scrapped Vongo, its consumer-facing Internet movie service, in favor of focusing on landing distribution deals with cable, telco and Web providers." But will cable want to make these deals only to have to compete inside its own platform with online distribution. Perhaps another reason why Comcast wants to limit downloads and Time Warner is looking to charge for heavy usage. Starz describes this online service as more limited than cable's product, “The services that we provide cable, satellite and telco are much more robust than Starz Play,” he (Starz president and chief operating officer Bill Myers) said. “It’s not a replacement product by any means. It allows us to get to customers who may not get Starz content in other formats.” But they may be a short term response as technology should make the distinction of the two services meaningless.