Video rental giant Netflix and movie studio Warner Bros. have been arguing about when Netflix will be able to offer Warner Bros. movies and shows to its subscribers. Warner Bros. sees Netflix’s ability to stream and mail movies and television shows to its subscribers the same day as they’re released on DVD as a hamper on DVD sales, so Warner Bros. has inked a new licensing agreement with Netflix that makes the rental company wait 28 days after material is released on DVD before it can offer the DVDs or the same material via the Internet. In exchange, Netflix will receive a larger number of units of Warner Bros. titles so subscribers won’t be greeted with the “Very Long Wait” message when trying to add recent released to their rental queues.
Financial terms of the new licensing deal were not disclosed.
Netflix tried to put a positive spin on the deal: “We’ve been discussing new approaches with Warner Bros. for some time now and believe we’ve come up with a creative solution that is a ‘win-win’ all around,” said Netflix’s chief content officer Ted Sarandos, in a statement.
Movie studios are seeing a steady decline in DVD sales as consumers turn to rental businesses and online streaming services for new releases; Warner Bros. move is designed to maximize the sales potential of their physical DVDs. The company says it sees 75 percent of its physical copies of new DVD released in the first four weeks of availability.
Netflix says that about 30 percent of the material it ships out to subscribers are new releases.
As part of the deal, Netflix is also getting expanded access to Warner Bros. movie and television library for online viewing.