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Netflix Will Use Starz Money for Other Deals

Following the announcement Thursday (Sept. 1) from Starz that it would not renew its agreement with Netflix when the contract lapsed in February of 2012, Netflix has issued a statement noting that while they "regret their decision to let our agreement lapse," the Starz content now plays a much smaller role in the overall popularity of their offering.

Netflix also stressed that they would use the money from the Starz deal on additional content.

"While Starz was a huge part of viewing on Netflix several years ago because it was some of the only mainstream content Netflix offered, over the years Netflix has spent more and more on licensing great TV shows from all four broadcast networks and many cable networks, and we have licensed first-run movies from Relativity, MGM, Paramount, Lionsgate and others," the statement noted. "Because we've licensed so much other great content, Starz content is now down to about 8% of domestic Netflix subscribers' viewing. As we add even more content in Q4, we expect Starz content to naturally drift down to 5-6% of domestic viewing in Q1. We are confident we can take the money we had earmarked for Starz renewal next year, and spend it with other content providers to maintain or even improve the Netflix experience."

The Netflix statement also noted that "early notice of their decision" will "give us time to license other content before Starz expires."

The statement also stressed that "Starz has been a great content partner since 2008 and we are thankful for their support" and that "we have tremendous respect for the Starz creative team, and we look forward to someday licensing some of their original or licensed content."