Netflix adds Relativity Media to its Instant queue, takes on HBO and Showtime
By Tim Stevens 
posted July 6th 2010 8:37AM
posted July 6th 2010 8:37AM
Netflix and Relativity Media Announce Groundbreaking Deal to Stream First Run, Studio Quality Theatrical Movies to Netflix Subscribers
LOS ANGELES, July 6 /PRNewswire-FirstCall/ -- Netflix, Inc. (Nasdaq: NFLX) and Relativity Media, LLC today announced a long term agreement through which major theatrically released films owned by Relativity will be licensed directly and exclusively to Netflix for streaming to its subscribers during the "pay TV window." Traditionally, these films have flowed through Relativity's studio releasing partners to output deals with premium TV channels.
The deal marks a continued shift in the distribution of major motion pictures in the U.S. Under the agreement, an increasing amount of popular contemporary movies previously encumbered by pay TV agreements with premium channels such as HBO, Showtime and Starz will become available to be streamed from Netflix months - and not years - after their release on DVD. It will be the first time that studio quality theatrical feature films will be streamed via subscription by Netflix instead of being broadcast by the traditional pay providers, and it opens up a new revenue stream for such movies.
Among the first wave of films covered under the Netflix-Relativity deal are "The Fighter," starring Christian Bale, Mark Wahlberg and Amy Adams and distributed by Paramount Pictures, and "Skyline," co-directed by the Brothers Strause and released by Rogue Pictures and Universal Studios. Both films are scheduled for theatrical release later this year and to be available at Netflix in early 2011. Also on tap for Netflix are Rogue Pictures' Nicolas Cage action/thriller "Season of the Witch" and "Movie 43," written and directed by Peter Farley. Both are set to hit theaters this year as well.
Relativity has financed, co-financed or produced more than 200 features, generating more than $13 billion in worldwide box office revenue. Fifty Relativity films have become "Top 10" box office releases during the past two years. Current Relativity theatrical releases include "Robin Hood," "Get Him to the Greek" and "Grown Ups." Relativity produces and/or finances between 20 and 30 pictures a year, and it has more than 10 "single picture" movies - films it is financing and producing fully - that are scheduled to be released over the next 12 months.
Broadening the range and appeal of content available for Netflix members to watch instantly is among the company's top priorities, and the agreement with Relativity is a meaningful step in building the company's streaming offer.
"Our continued goal is to expand the breadth and timeliness of films and TV shows available to stream on Netflix," said Ted Sarandos, chief content officer for Netflix. "Historically, the rights to distribute these films are pre-sold to pay TV for as long as nine years after their theatrical release. Through our partnership with Relativity, these films will start to become available to our members just months after their DVD release."
Added Mr. Sarandos: "Relativity has produced and financed some of the biggest and best films released in the last few years. We are thrilled to partner with them on their exciting upcoming slate of films and to be part of each other's ongoing success."
"We have always been about finding new ways to grow and monetize our business," said Ryan Kavanaugh, Relativity's CEO. "This clearly is a natural step in the evolution of the movie business and opens up a whole new world of revenue and marketing opportunities. Netflix has certainly made its mark, with a service that reaches over 13 million people and allows consumers to have what they want, when they want it. We have a shared vision, and this deal marks a significant change in our industry."
"Consumer demand and interest in new platforms are evolving nearly as quickly as the technology," said Michael J. Joe, Relativity's president. "The growing number of Netflix subscribers streaming first run movies is very exciting and presents another viable option for us to maximize the long-term business behind our properties. We're delighted to partner with them on this incredible new opportunity, which has great promise for our industry-reshaping Pay TV deals going forward."
The deal was negotiated on Relativity's behalf by Mr. Joe and Andrew Marcus, the company's chief operating officer, and on behalf of Netflix by Robert Kyncl, the company's vice president of content acquisition.
About Netflix
With more than 13 million members, Netflix, Inc. (Nasdaq: NFLX) is the world's largest subscription service streaming movies and TV episodes over the Internet and sending DVDs by mail. For $8.99 a month, Netflix members can instantly watch unlimited TV episodes and movies streamed to their TVs and computers and can receive unlimited DVDs delivered quickly to their homes. With Netflix, there are never any due dates or late fees. Members can select from a growing library of titles that can be watched instantly and a vast array of titles on DVD. Among the large and expanding base of devices that can stream movies and TV episodes from Netflix right to members' TVs are Microsoft's Xbox 360, Sony's PS3 and Nintendo's Wii consoles; Blu-ray disc players from Samsung, LG and Insignia; Internet TVs from LG, Sony and VIZIO; the Roku digital video player and TiVo digital video recorders, and Apple's iPad tablet. For more information, visit http://www.netflix.com.
About Relativity Media, LLC
Relativity Media, LLC is a media and entertainment company that focuses on creating, financing and distributing first class, studio-quality entertainment content and intellectual property across multiple platforms, as well as making strategic partnerships with, and opportunistic investments in, media and entertainment-related companies and assets. Relativity owns and operates Rogue, a company that specializes in the production and distribution of lower-budget genre films, which has had particular success within the horror genre with films including The Unborn and The Strangers. Building upon its foundation of financing and producing films, Relativity has grown to include music, sports and television divisions and the next-generation social network iamrogue.com. Relativity also owns and operates RelativityREAL, Relativity's television arm, which has become one of the leading suppliers of reality television with more than 20 shows in episodic or pilot. RelativityREAL is run by Tom Foreman; his past successes include Extreme Makeover: Home Edition and Kid Nation.
To date, Relativity has committed to, produced and/or financed more than 200 studio-quality motion pictures through 2014. Released films have accumulated more than $13.0 billion in worldwide box office revenue. Relativity's recent films include Dear John, Brothers, The Wolfman, It's Complicated, Zombieland, Couples Retreat, The Bounty Hunter and, most recently, Get Him to the Greek, Robin Hood and Grown Ups. Upcoming films for Relativity include The Fighter, Despicable Me, Charlie St. Cloud, Salt, Nanny McPhee 2, The Social Network as well as James Cameron's Sanctum in 3D and Wes Craven's My Soul To Take in 3D. Twenty-nine of the company's films have opened at No. 1 at the box office. Relativity films have earned 43 Oscar® nominations, including nods for Nine, A Serious Man, Frost/Nixon, Atonement, American Gangster and 3:10 to Yuma. Forty-eight of Relativity's films have each generated more than $100 million in worldwide box-office receipts.
The more I've used my instant queue, the more I've realized just how little "watchable" content is on there.
@trainwrecka Maybe that was a bit over the top. They do have a lot, but 9 times out of 10, if I search for a movie to watch instantly, it is not available. Be it old or new.
@trainwreck While I agree the movie selection is a little poor, the TV selection is great. I've been watching Rescue Me in [semi]HD for a few weeks now. It would be nice however to get some good recently released movies on Watch Instantly.
@tasteskindasalty Agreed. The TV show selection is pretty good. We're catching up on seasons of The Office and 30 Rock right now. Then again, Hulu IS owned by NBC...
@trainwrecka
Really? I have a shitload of items in my queue that I want to watch. I've got 269 items in it right now, with quite a few TV shows on there (like 12 seasons of King of the Hill).
I think you may just need to branch out more and try new movies.
@trainwrecka Funnily, I've had the exact opposite experience. My Instant queue is 3 times as long as my regular DVD one.
@trainwrecka I don't watch much "broadcast" or cable tv. I caught the first season of "Better off Ted" on there and that was decent. There's a fair amount of worthwhile stuff there and a lot of schlock.
@aubreyq
I think they are talking about Netflix and not Hulu.
@trainwrecka they have wonderpets on there. that could be the only thing on instant queue and it would be enough.
@tasteskindasalty the TV selection is top
notch. Dexter, Lost and more recently Futrurama. It's awesome because I get to watch shows that I've nver gotten a chance to get into.
@trainwrecka
Netflix Instant Watch is AWESOME for TV it has almost every show that I'd want to watch (Buffy, Roswell, 24, Xena, XFiles, Rescue Me, Lost, etc.) and at my "fingertips." I also like the movie selection - then I like cheesy 80s movies, it could be better.
The thing I don't understand is the whole point of Netflix screwing us over with the Warner Brothers deal was, we were supposed to have access to WB content via instant streaming. At the time I said this wouldn't happen, and everyone poo pooed me...
@trainwrecka : Its about time, I can only watch "Mad Max" and "The good the bad and the ugly" a few more times. The rotation sucks.
@trainwrecka
Agreed. Netflix watch now movie selection is not good. But it is "free" so who can complain. Their model is not streaming movies. It's still shipping dvds via mail.
Hopefully that will flip as I'd rather not use DVD's and mail anymore and just stream what I want to watch.
But I know there is a lot of red tape, license deals and greedy hands involved to allowing a movie to be played on a screen legally...
Maybe one day all of the entities that own the media will realize they all need to get on the same page.
@trainwrecka
Agreed. There are a lot of TV shows, but even then its a bit of hit and miss. Like Heroes, where you can only get season 3. There really are not a lot of good movies to watch, and good luck trying to find anything recent. I've spent a good deal of time watching Lost since I've never had the patience to wait for the next episode to watch it on TV, but after that I'm probably going to cancel the subscription until they get more content available on instant queue. DVDs are going the ways of the VHS.
@eyhk
FYI - all 4 seasons of Heroes are available on Instant Streaming. I just spent the last couple of months watching them. If you're using a device that has no search function (ie PS3, Xbox360 or Wii), get on a computer and search for Heroes and then add them to your Que.
Just watched my first episode of Lost last week and it's going to take me a long time to watch all of them. I believe seasons 1-5 are currently available and by the time I finish them seasons 6-7 should be there as well.
Gotta love Netflix. I just wanna see it expand and expand.
@216 ...what no takers? I guess it's my turn. That's what she said.
@untitled That's played out
@ashleythehottiest
Saying "That's played out" is played out.
@jaradFromSubway
Actually I haven't heard that's played out in a while...
@Dig Deep You haven't heard that in a while? Well, thats wiggity-wack!
What's the best "plan" for Netflix?
@Distant Depends how much time you got to watch DVDs. For Watch Instantly, you need at least the $9/mo. plan, which gives you unlimited DVDs per month which are mailed to you one at a time (get one, mail it back, the other one gets shipped). Higher priced plans get you more DVDs at home at the same time, plus Watch Instantly, of course.
@Distant I have 2 out at a time ($14) and blu-ray access ($3), plus $1 tax. I consider $18 a pretty good deal compared to what it would cost to rent all the movies, plus the convenience factor. It's still cheaper than buying 1 movie a month, and I watch at least 10, not counting streaming which I do quite a bit when I get caught up in a new (to me) show. I just started watching 24 last month and I'm already on season 3. Having a fast internet connection is a must if you don't want pixelation though.
So their definition of instantly is months. Tsk ts.
Anyway who cares, they are only for the US - still.
@eeekthesneak They said they will announce a new country that will have Netflix this year. Whatever country it is, it must have great postal service. I wonder if it's the UK?
@aubreyq
What is this "UK" country you speak of?
I just go thru what's there. Usually find movies I wanted to see but had never watched yet.
@Iamperfect2
True or shows that I haven't seen since the 90's (i.e Ren & Stimpy). Netflix always has something to watch and it's one of the few services left where you're getting more for the same pride then what you were getting years before...
"Within months?" How about within hours? If you have to still wait months, they blew it.
im more interested in TV shows. Movies are great but most of what i want to watch is on discovery,history,HGTV,FX and science channel.
You say that like watching MST3K and nothing else is a bad thing.
@nutbunnies Oh trust me, I'm thrilled when a new Joel classic pops onto my queue -- a little less-so when a new Mike entry appears.
@TimStevens
Maybe it's because I wasn't old enough to remember watching MST3K until the Mike seasons, but I find Joel so much more boring than Mike.
But to each his own. As long as I never have to watch a first season episode with the travesty they call Tom Servo's voice actor that season, I will be happy.
Netflix has taught me to appreciate B-Movies, crap from Troma, and foreign films. I admit that sometimes it is frustrating that the film I want is not avilable to be streamed, but, I have also discovered all sorts of foreign and independant goodies that were truly enjoyable which I otherwise would not have discovered.
HEY! The ONLY bad thing about MST3K on netflix is that they don't have Puma Man on there, or out on DVD as of yet.
@admlshake
Seriously, I was about to write that MST3K is actually a step up from modern Hollywood movies...
This is great news. I have been hoping to watch the HBO content for some time without having to get all the dvds.
@Robhimself
I'm pretty sure you're not going to be getting original HBO content via Instant Streaming, just some movies that previously had long, exclusive windows post-DVD release.
@VICinCLT
Oh bummer I guess I didn't really think of it since I only watch the HBO series and don't really care about the movies. It will still be nice to have more streaming options. I would however love to be able to watch the shows..
@Robhimself The day HBO comes on Netflix is th day I cut off my own foot. Even if they did come to an agreement, HBO would want to charge an extra $5-10 per month lol.
@Robhimself And I agree with you but they should seriously consider it. I mean showtime does it and honestly Dexter alone is the reason I subscribe to SHO hands down the best series on cable and TV in general imo. HBO has good shows and more of them but not enough to get me to spend the extra premium that they want.
Netflix has improved somewhat afterwards I hope they improve the streaming clarity
@FritzJ92 The HD content on Netflix is really quite good. The StarzPlay titles look like crap,and should not be used to judge (unfortunately the StarzPlay titles are more often newer movies so it seems like they should be the best)
It also depends a lot on bandwidth. And how far into the title you are. When you first hit play it streams at 500Kbps for 30 seconds or so, then bumps up to 1500 or so and ultimately up to 3800 depending on your bandwidth. So basically the first 30 seconds of any episode is going to look shoddy, but will improve immensely if you have the bandwidth to support it.
If you are curious, Left click on the playback window while holding ALT-SHIFT and select on AV-Stats. You should be able to see what rate you are streaming, what rate you are queuing and how big of a buffer you have.
This sounds like a really good deal..... can't wait to see more first run content come to streaming even if it means they have a separate charge for it.
Keep adding cool stuff as long as it doesn't affect the cost. $9/mo is my limit for the service.
I dream of a world where all content providers (NBC, HBO, Discovery, etc.) all have online streaming subscriptions and I can finally have my ala carte subscriptions (Ideally in HD with 5.1).
Cool, now lets see them reorganize instant so tv is organized by season/episode instead of physical DVDs and a better presentation of recommendations for instant watching.
@devoinregress and a "streaming only" netflix subscription.
@devoinregress Not sure what you are referring to. TV shows in my Netflix queue are organized by Season and Episode. Of course, this is using the Xbox 360 interface ;-)