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Warner Bros. Grows Content Streaming with Netflix

Warner Bros. Home Entertainment Group
has expanded its existing agreement for streaming content with movie-rental
subscription service Netflix, which has been experiencing significant growth
for its streaming service that makes thousands of movies and TV shows available
on-demand on PCs and laptops as well as through broadband-enabled TVs and other
"connected devices."

The new deal adds a slate of catalog TV
shows available to watch instantly at Netflix and extends the existing license
for catalog movies through 2011. The big news in the deal is that Netflix has
acquired streaming rights, for a period of four years, to all 100 episodes of
the popular drama Nip/Tuck, which
ended its initial run on FX earlier this year. Nip/Tuck will also air on a traditional linear basis on the cable
network Logo, which reached an off-cable syndication deal with Warner Bros.
Domestic Television Distribution.

Other shows which Netflix is picking up
streaming rights to as part of its new deal with Warner Bros. include the
series Veronica Mars, Pushing Daisies and Terminator: The Sarah Connor Chronicles. Warner Bros. says the
serialized shows are a good fit for streaming, as consumers can enjoy on-demand
access to multiple episodes.

"Our Netflix streaming
relationship is a good example of the opportunities the digital space provides
to make content available in new ways at appropriate points in the product
lifecycle," said Thomas Gewecke, president of Warner Bros. Digital
Distribution, in a statement. "This agreement establishes an additional
stop on the economic chain for our library content while providing consumers
with more convenience and choice."

"This agreement breaks new ground
for both of us in the area of subscription, commercial-free streaming of first
cycle syndication network and cable TV shows," added Robert Kyncl, VP of
content acquisition for Netflix. "We are proud to make more movies and TV
episodes from Warner Bros. available to Netflix members."

Warner Bros. said the new streaming
deal doesn't affect an agreement reached with Netflix earlier this year
regarding new release titles on DVD and Blu-ray. Under that deal, such DVD and
Blu-ray titles will be made available to Netflix subscribers after a 28-day
window, giving Warner Bros. the opportunity to maximize retail sales of those

The new deal is the first time Warner
Bros. has licensed TV shows to Netflix's streaming service. But the agreement
for Nip/Tuck, which follows a deal
last week by movie studio Relativity Media to license new movie releases for
streaming by Netflix, indicates that the service is increasingly viewed as a
viable new option for monetizing content. In particular, it provides
flexibility for shows that are too edgy, or had too short a run, to be picked
up in off-net syndication by major cable networks like TBS or USA. In the case
of Nip/Tuck, the combination of the
streaming deal with Netflix and the linear agreement with Logo was similar to
Warner Bros. reaching a shared syndication deal with several cable networks.

"Consumers now have the ability to
choose how they enjoy Nip/Tuck,
either streamed instantly from Netflix or in a more traditional linear fashion
on Logo," said Ken Werner, president of Warner Bros. Domestic Television
Distribution. "Veronica, Daisies and Sarah Connor are all high-quality, critically acclaimed series with
passionate fan bases but which have a limited number of episodes, preventing a
more traditional syndicated rollout. Netflix can offer the consumer instant
access to multiple episodes, creating a viewing experience that is a plus for
serialized shows."