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Starz's Netflix Contract To Expire February 2012, Taking Over 1,000 Movies With It

The Huffington Post   First Posted: 09/01/11 07:16 PM ET Updated: 11/01/11 06:12 AM ET

Starz Netflix Deal Contract Renewal Cancel

If you have any Starz movies you want to see on Netflix, you might want to hurry up and watch them before it's too late.

Starz has announced in a press release that it is cutting off contract renewal negotiations with Netflix and has no plans to fire them back up:

When the agreement expires on February 28, 2012, Starz will cease to distribute its content on the Netflix streaming platform. This decision is a result of our strategy to protect the premium nature of our brand by preserving the appropriate pricing and packaging of our exclusive and highly valuable content.

Apparently, the money just isn't there, and it sounds like Starz is interested in seeing other people. Netflix paid $30 million back in October 2008 to gain the rights to stream Starz films, and many analysts called the deal a steal for Netflix.

Back in June, Sony temporarily pulled its movies from Netflix due to a "temporary contract issue" with Starz. In March Starz announced that Netflix Instant customers would have to wait 90 days before viewing its original programming like 'Camelot.' In January 2011 Starz CEO Chris Albrecht told Bloomberg that his company didn't "need this deal for [their] profitability."

Netflix CEO Reed Hastings told AllThingsD in June 2011 that he's willing to spend as much as $200 million to renew his company's Starz contract; though exact figures from recent negotiations have not surfaced, it appears that talks have permanently stalled.

When Netflix split its services between DVD rental and Streaming in June, it received much criticism on its website from members who found it to have a weak streaming selection; should Netflix now lose Starz films in February 2012, that weak selection will become even weaker. Starz Play included over 2500 movies when the deal was signed in 2008, though Netflix's website currently advertises about 1000 movies in its Starz Play section.

This could be a big blow to Netflix, even by its own admission. In its 2010 Annual Shareholder Report, the company stated that "[i]f we are not successful in maintaining existing and creating new relationships, or if we encounter technological, content licensing or other impediments to our streaming content, our ability to grow our business could be adversely impacted."

Netflix's stock is already down 8 percent in after hours trading as of press time, and its subscriptions might be "adversely impacted" in about 4 months, if it can't figure something out with Starz or another content provider soon.

Netflix has not responded to a request for comment.

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