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Will Richmond is editor and publisher of VideoNuze, a widely-followed online publication which provides daily industry analyses and news aggregation for broadband video decision-makers available at www.videonuze.com. Will is also president and founder of Broadband Directions LLC... More
  • With New CBS Deal, Netflix Reminds Amazon (and Hulu) Who's the King of the Streaming Jungle 1 comment
    Feb 22, 2011 3:10 PM | about stocks: AMZN, NFLX, CBS, DIS, CMCSA, VIA
    As if on cue, Netflix announced a new streaming deal with CBS this morning, just hours after Amazon took the wraps off its own streaming feature for Prime users. Under the 2-year deal, Netflix will get episodes from classic series like "Star Trek," "Frasier," "Cheers," "Twin Peaks," "Hawaii Five-O," "The Twilight Zone," and others. It will also include certain episodes from current shows like "Medium" and "Flashpoint." The companies had a previous streaming deal signed in late 2008 that covered series like "NCIS," "CSI" and "Numbers" which appears to have expired.

    The new CBS agreement sends a strong message to Amazon that when it comes to premium content, Netflix is still the king of the streaming jungle. If Amazon wants to compete title-for-title, it is going to have to spend aggressively for content. As I pointed out earlier today, Amazon is only likely to do this if it sees meaningful increases in Prime membership due to the new streaming feature, which I believe is unlikely.

    Related, the CBS-Netflix deal is yet more bad news for Hulu and Hulu Plus. Though CBS isn't an equity partner in Hulu, making its deal with Netflix not quite the same slap in the face to Hulu that prior NBCU and ABC deals with Netflix were, it's still another painful reminder that Hulu simply doesn't have the financial muscle to compete for top-level content for its Hulu Plus service. As Netflix's chief content officer Ted Sarandos told me during my interview with him at NATPE, at this stage, there's no premium content offered up for licensing that Netflix doesn't get a look at. If Netflix decides to bid, its extensive user data provides lots of value to support how much to bid.

    In fact, with the exception of Hulu's recently announced deal with Viacom for The Daily Show and The Colbert Report and a smattering of art-house/international films from Criterion, Hulu hasn't announced any notable content additions to Hulu Plus since it launched in beta last June. As I've said before, Hulu Plus is caught between a rock and a hard place when it comes to content acquisition; on one side it has the pay-TV operators which are aggressively trying to lock up content behind TV Everywhere subscription walls, and on the other Netflix, who's 20 million+ subscriber base and buoyant stock price give it enormous financial flexibility.

    This advantage is unlikely to change soon; even Hulu's relationships with ABC, NBC and Fox, for TV programs on Hulu.com that were supposed to be the foundation for its rumored IPO, were recently deemed insufficiently long-term, thereby scotching the offering.

    There are still many chapters to play out in the battle for streaming premium content supremacy, but for now Netflix reigns as the uncontested king. 
    Stocks: AMZN, NFLX, CBS, DIS, CMCSA, VIA
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  • joey554
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    Yippee Netflix just signed to stream more irrelevent tv shows.... whoppie they are becoming a tv streaming service for all the shows you can find on tv land. The content on Netflix streaming is junk and anyone who has had it for more then a month knows this.
    Amazon comes out day 1 and has 5,000 streaming titles which is nearly half of the 11,000 Netflix has taken years to acquire. Not just that but Netflix has no exclusive rights to anything so Amazon can and will offer the same thing as it builds up it's service at a cheaper price.
    22 Feb 2011, 03:59 PM Reply Like
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