Netflix Inks Another Pay-TV Window Movie Output Deal

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Netflix, continuing to encroach on the turf of premium movie channels, announced a multiyear agreement to offer first-run films distributed by FilmDistrict for streaming over the Internet in the pay-TV window a few months after their release on DVD.

Financial terms of the deal weren't disclosed. Under the deal, motion pictures that traditionally would have been licensed to premium cable channels from HBO, Showtime Networks or Starz Entertainment will instead be available to Netflix for streaming to its members, beginning in 2011.

To be sure, it's a comparatively tiny deal: FilmDistrict, created this fall, expects to distribute between four and eight wide release commercial pictures per year. The movie acquisition, production and distribution firm was founded by producer Graham King and his business partners Tim Headington and Peter Schlessel, who is now FilmDistrict's CEO.

Among the first films to be covered under Netflix's deal with FilmDistrict deal are Drive, starring Ryan Gosling and Carey Mulligan, and sci-fi action adventure film Lockout, starring Guy Pearce and Maggie Grace, produced and co-written by Luc Besson.

The FilmDistrict pact is part of Netflix's ongoing drive to bulk up its on-demand streaming library.

This summer Netflix stuck a deal with Epix, reportedly worth nearly $1 billion over five years, to offer movies via streaming 90 days after they debut on Epix's services. Netflix also signed a deal with Relativity Media under which it will be able to stream 10 to 14 movies per year that otherwise would have been distributed through cable networks.

"Netflix has a long and successful history working with Peter Schlessel and Bob Berney, and I have long admired Graham King's amazing production success with movies like 'The Departed' and 'Blood Diamond,' which are among the most watched and highly rated movies of all time by Netflix members," Netflix chief content officer Ted Sarandos said in a statement. "We are thrilled to be in business with these proven tastemakers and entertainment business leaders."

Netflix had 16.9 million subscribers at the end of September 2010. The company last month introduced a $7.99 per month streaming-only subscription plan to U.S. customers, while it raised prices for its DVDs-by-mail packages between 11% and 18%.