Netflix customers will be unable to get their hands on Warner Bros. DVD and Blu-ray releases for 28 days after initial retail release, under a new agreement the companies announced Wednesday.
At the same time, Netflix will expand the number of titles from Warner Bros. Home Entertainment Group available to be streamed instantly to TVs and computers. Specific terms of the deal were not disclosed.
According to a joint statement from the companies, the 28-day window will give Warner Bros. "the opportunity to maximize the sales potential of those titles," while Netflix will benefit from "reduced product costs and significantly more units and better in-stock levels four weeks after street date."
Netflix's legal right to rent DVD titles immediately when they go on sale at retail has been a sore spot with Hollywood studios. According to Warner Bros., 75% of DVD sales occur in the first four weeks of release.
"These new agreements build upon the strong relationship we have had with Netflix for nearly 10 years," Warner Home Video president Ron Sanders said in a statement. "The 28-day window allows us to continue making our most popular films available to Netflix subscribers while supporting our sell-through product."
Netflix has been "discussing new approaches with Warner Bros. for some time now and believe we've come up with a creative solution that is a ‘win-win' all around," Netflix chief content officer Ted Sarandos said.
Netflix, which has more than 11 million subscribers, provides Internet video streaming to subscribers on a variety of broadband-connected devices from manufacturers including LG Electronics, Samsung, Sony, Best Buy's Insignia brand, Roku and TiVo. In addition, the Internet service is available on Microsoft's Xbox 360 and Sony's PlayStation 3 game consoles.
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