SAN FRANCISCO (AP) — Netflix's video subscription service has trumped pay-TV channels and grabbed the rights to show Disney movies shortly after they finish their runs in theaters.
The multiyear licensing agreement announced Tuesday represents a breakthrough for Netflix as it tries to add more recent movies to a popular service that streams video over high-speed Internet connections.
Netflix will have exclusive U.S. rights to offer the first-run movies through its streaming service during the period normally reserved for premium TV network such as HBO, Starz and Showtime. That period starts about seven months after movies leave theaters. The exclusivity does not extend to DVDs, a service Netflix is trying to phase out.
Investors applauded Netflix's coup, lifting the company's stock by $8.86, or nearly 12 percent, to $84.86 in afternoon trading.
It's the first time that one of Hollywood's major studios has sold the coveted rights to Netflix Inc. instead of a premium TV network. DreamWorks Animation SKG Inc. licensed the pay-TV rights to its movies to Netflix last year under a deal that begins in 2013, but those movies don't wield the same box-office appeal as Disney, whose stable includes Pixar Animation and Marvel.
Starz currently holds the rights to The Walt Disney Co.'s movies under a deal that expires in 2015. Beginning in 2016, Netflix will get the movies instead. Direct-to-video movies will come to Netflix sooner, as will older movies such as "Dumbo" and "Alice in Wonderland." In Tuesday's news release, the Los-Gatos, Calif.-based Netflix didn't disclose how much it is paying Disney.
The Disney deal gives Netflix a measure of revenge against Starz, which had been demanding a price that Netflix refused to pay when their licensing agreement expired earlier this year. The Starz rights had included Disney movies, so losing that access had been seen as a blow to Netflix.
The stock price of Liberty Media Corp., Starz' owner, dropped $7.08, or 6.4 percent, to $103.97 in afternoon trading. Shares of Disney, which is based in Burbank, Calif., lost 3 cents to $49.26.
Archive: Wednesday
Netflix outbids TV for Disney movies
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Leelanau will pay to settle lawsuit
Leelanau County will pay $55,000 to settle a lawsuit stemming from allegations county sheriff’s deputies illegally detained a man.
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NMC may hike tuition for some
Northwestern Michigan College board members took their first look at next year’s draft budget, which included a nearly 32 percent tuition hike for the nursing, automotive, and audio-tech programs.
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Editorial: TBAISD hoards money as schools struggle
The issue: TBAISD’s millions. Our view: Big changes needed.
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Home foreclosure could be 'windfall' for Benzie
Tax foreclosure on a lakefront home valued near $800,000 could be a “windfall” for Benzie County.
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Business in Brief: 05/15/2013
TEDx speaker match; Evaluation planning; Employment forecast. (Plus more)
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Letters to the Editor: 05/15/2013
Get on the bus; Not an abortion pill.
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Prep Sports Roundup: Youker pitches second no-hitter
Amanda Youker pitched her second no-hitter of the season as Kingsley whitewashed Buckley 11-0 in the opener of a Northwest Conference softball doubleheader Tuesday. (Plus more)
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Suspects arraigned in horse case
Antrim County authorities filed a civil action to seek legal forfeiture of 18 horses seized in an animal cruelty investigation.
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Suspect has multiple prior convictions
Zackariah Hornback, 19, was arraigned Tuesday in 86th District Court on a felony charge from a temporary warrant issued over the weekend.
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Ride of Silence honors fallen cyclists
Cyclists are invited to join the Traverse City Ride of Silence to raise awareness among motorists, cyclists, police, city officials and residents.
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Electrical fire damages cottage
Investigators said an electrical problem sparked a fire at a seasonal cottage on Long Lake Peninsula.
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Man charged with criminal sexual conduct
A Suttons Bay man faces a felony charge for allegedly having sex with a girl on multiple occasions.
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Community in Brief: 05/15/2013
Bethany meeting; Peace Corps get-together; ice cream social and plant sale; and more.
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Today in Sports: 05/15/2013
What's happening in sports across the region and the country:
Continued ... - Poll: Should TBAISD boost contributions to school districts?
- Wednesday, May 8, 2013
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Prep sports scoreboard: 05/08/2013
A roundup of high school sports results from across northern Michigan:
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Man's body found in field
Authorities are trying to figure out the identity of a body found in an East Bay Township field.
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Kalkaska voters reject new library
Voters in Kalkaska County rejected a proposed millage to fund a new county library building by a 2-to-1 margin.
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Body found in East Bay field
Authorities located a body in a field in East Bay Township.
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Editorial: State obliged to provide criminal defense for indigent
They are ugly statistics that paint a picture of a state heading down an unsustainable — and unjust — path.
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Traverse City OKs food trucks
It’s official: Food trucks can set up their roaming shops downtown starting May 16.
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TC West tops TC Central 5-1
Traverse City West — despite playing without four players with ankle and knee injuries — racked up a 5-1 home victory Tuesday over rival Traverse City Central to remain in a virtual Big North Conference first-place tie with Cadillac.
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Titans sweep the Trojans
With Major League Baseball scouts looking on, Traverse City West’s Walter Borkovich dominated Tuesday in pitching the Titans to a 10-2 win over crosstown rival Traverse City Central in the opener of a Big North Conference doubleheader.
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Interlochen's Jack Driscoll wins author award
Jack Driscoll is a 2013 winner of the prestigious Society of Midland Authors Award. The novelist, poet and long-time Interlochen resident earned a prize in Adult Fiction for his latest collection of short stories, “The World of a Few Minutes Ago” (Wayne State University Press).
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Letters to the Editor: 05/08/2013
Tax-free traffic calming; Endorsing scientists?
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Leelanau will pay to settle lawsuit
Twiggy, the Water Skiing Squirrel
Sailor Surprises His Mom At Her CU Denver Graduation Ceremony
Official: ‘Amazing’ No One Was Killed In CT Train Crash
Lotto Fever Sweeps the Country
Coffee Stop Leads To Arrest Of YouTube Sensation Wanted For Murder
Bearded Dragon Reunited With Owner
Marine Reunited with Warzone Companion
Raw: Crash Sends Car Into Fla. Pool
Beyonce Is Pregnant!
SF baseball player overpaid $500,000 RETURNS money -- and team says KEEP IT
$1 Million in Jewels Stolen at Cannes Film Fest
Dad returns from Afghanistan, surprises family during Rays' first pitch
See Jennifer Lopez's New $10m Hamptons Mansion
Woman tricked into taking abortion pill
Emma Watson Goes Pantless
IRS scandal: Republicans seek to tie Obama to agency's woes
Play of the Day: Flipping to Safety
Pregnant Kim Kardashian Squeezes Her Swollen Feet Into Stilettos
Top Videos of the Week: Angry Taco Bell Guy, Glacier Moves on House, Dog Hates Baths
Cindy Crawford Stuns At Cannes
