{"id":4119,"date":"2011-09-06T09:48:39","date_gmt":"2011-09-06T14:48:39","guid":{"rendered":"http:\/\/techcitement.com\/?p=4119"},"modified":"2011-09-12T10:05:34","modified_gmt":"2011-09-12T15:05:34","slug":"starz-drops-netflix-%e2%80%94-time-to-abandon-ship","status":"publish","type":"post","link":"https:\/\/techcitement.com\/internet-2\/webapps\/starz-drops-netflix-%e2%80%94-time-to-abandon-ship\/","title":{"rendered":"Starz Drops Netflix \u2014 Time To Abandon Ship?"},"content":{"rendered":"
Looks like Netflix is in for some hard times, folks. Having followed through<\/a> with their 60 percent<\/a> hike in prices<\/a>, Starz Entertainment, one of their earliest and largest content providers, took advantage of the moment, choosing the first day of the price increase to make a big announcement.<\/p>\n From Market Watch<\/a>:<\/p>\n Shares of Netflix Inc. fell sharply Friday on the news that Starz Entertainment has ended negotiations to keep its content on the company\u2019s streaming service into next year.<\/p>\n The stock has slumped nearly 30% since peaking atop the $300 mark in mid-July \u2014 when it announced new pricing plans that resulted in a significant fee hike for subscribers to both its DVD rental and streaming plans and takes effect this week.<\/p>\n Late Thursday, Starz announced that it has ceased negotiations to renew its contract for streaming content with Netflix. The current agreement is set to end on Feb. 28 of next year. Starz is owned by Liberty Media Corp.<\/p>\n In a statement, Starz said the move was designed \u201cto protect the premium nature of our brand by preserving the appropriate pricing and packaging of our exclusive and highly valuable content.\u201d<\/p><\/blockquote>\n Netflix stock had recovered slightly by the end of the day with a net loss of 8.64 percent. Of course, Netflix wasn’t going to let the Starz announcement go unanswered and shot back with this<\/a>:<\/p>\n Netflix responded by noting that, while Starz \u201cwas a huge part\u201d of the company\u2019s streaming service when it first launched its streaming service in 2008, it has since fallen to about 8% of domestic viewing and is expected to slip to 5%-6% by the end of the year, as more content is added to the service.<\/p>\n \u201cWe 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,\u201d the company\u2019s statement read.<\/p><\/blockquote>\n Starz’s move is a negotiating tactic, nothing more. Remember, the Netflix\/Starz contract doesn’t end until February 28, 2012, six months after Thursday’s announcement. That leaves them considerable time come back to the table and reach an agreement.<\/p>\n