Light Reading
Also: Netflix CEO downplays Starz loss, judge OKs Comcast-NBCU deal, FCC feels Mediacom's wrath, Apple TV tops OTT box review

Did Starz Reject $300M Netflix Offer?

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
9/2/2011
50%
50%

Fallout from the bombshell Starz Entertainment LLC lobbed at Netflix Inc. (Nasdaq: NFLX) on Thursday afternoon leads off Friday's extended cable news roundup. (See Netflix, Starz on the Outs .)

  • Netflix offered more than US$300 million to renew its deal with Starz, but the premium programmer balked because it demanded that the video streamer package Starz content with a premium-priced tier, reports The Los Angeles Times. Netflix didn't go for it, but the paper said Starz wanted that condition to protect its relationships (and pricing) with MSOs, telcos and satellite service providers that are fearful that baking Starz into the current Netflix tiers, which start at $8 per month, could leave them vulnerable to more cord-cutting.

  • Netflix hasn't issued a statement about the unraveling with Starz as of this writing, but Netflix CEO Reed Hastings shrugged off the effects in comments given to Business Insider. Hastings said Starz content currently represents 8 percent of domestic Netflix subscriber viewing and expects that to dip to five to six percent in the first quarter of 2012 as it adds a "huge" amount of content before the end of 2011.

  • Jefferies & Company Inc. Managing Director Youssef Squali isn't as confident that Netflix can fill the gap and keep churn in check, pointing out in a note issued this morning that Starz provided Netflix with movies from Sony and Disney representing up to 30 percent of Hollywood studio output. Netflix could try to score Sony and Disney movie deals on its own, but it'll have to settle for later release windows, he wrote.

  • The news on Netflix didn't help out its stock. It was down $19.79 (8.48 percent) to $213.48 each in early trading Friday.

  • A U.S. district judge approved Comcast Corp. (Nasdaq: CMCSA, CMCSK)'s acquisition of NBCUniversal LLC on Thursday with conditions that give the court oversight on the deal for two more years. The court will be keeping a particularly close eye on how the MSO doles out rights for NBCU content to online video distributors. Here's the full order. (See Comcast-NBCU Rules to Frustrate OTT Players.)

  • Mediacom Communications Corp. Chairman Rocco Commisso blasted the Federal Communications Commission (FCC) Chairman Julius Genachowski for not moving quickly enough on its pledge to reform retrans rules. The MSO's in a heated stand-off with LIN Media, with LIN-owned broadcast TV stations still blacked out in several Mediacom markets. (See FCC Reexamines Retrans Rules.)

  • So, maybe Google (Nasdaq: GOOG) does have a strategy for Motorola Mobility LLC 's cable technology assets after all. Company Chairman Eric Schmidt said Moto's product line also formed part of its allure. "We did [the deal] for more than just patents," he said in this Bloomberg report. "The Motorola team has some amazing products." (See Cover Sheet: Google to Acquire Moto Mobility.)

  • Which over-the-top box -- the Apple TV, Roku 2 or Boxee Box -- is the best for the average consumer? According to The Wall Street Journal's Walter Mossberg, his vote went to Apple Inc. (Nasdaq: AAPL)'s latest entry, with Roku Inc. a close second. He recommends Apple TV for people who use iTunes a lot, but was particularly keen on the Roku 2's simplicity and video quality. He liked the vast library of the pricier Boxee box, but found it much more complex and therefore better suited to tech geeks.

    — Jeff Baumgartner, Site Editor, Light Reading Cable



    (2)  | 
    Comment  | 
    Print  | 
  • Newest First  |  Oldest First  |  Threaded View
    Cooper10
    50%
    50%
    Cooper10,
    User Rank: Light Beer
    12/5/2012 | 4:54:51 PM
    re: Did Starz Reject $300M Netflix Offer?


    If Netflix offered $300M per year, that would enable 22M Netflix subs (Netflix estimate of their streaming subs after rate increase) to stream Starz content.  Doing the math, that works out to a little over $1 per sub per month.  Pay TV license fees for Starz are still 3X to 4X what Netflix offered on a per sub basis.  Would be surprised if Netflix does not begin to see more demands on content renewals be based on per sub fees, vs. flat rate.

    shadow66
    50%
    50%
    shadow66,
    User Rank: Light Beer
    12/5/2012 | 4:54:47 PM
    re: Did Starz Reject $300M Netflix Offer?


    why Netflix want to stick a flat price and rejected a  premium price tier?  as long as the price is better than cable and other tradtional channels, it's also increase NetFlix's revenue and profit.


     


     

    Flash Poll
    LRTV Huawei Video Resource Center
    The Inaugural Optical Innovation Forum in Nice

    9|2|14   |     |   (0) comments


    More than 170 attendees from network operators, service providers, analyst firms, and component companies from around the world convened in Nice in June for the inaugural Optical Innovation Forum, co-produced by Huawei and Light Reading.
    Wagner’s Ring
    Data Centers Drive Telcos Into the Future

    8|28|14   |   2:20   |   (2) comments


    Data centers are at the heart of key trends driving telecom -- network virtualization, the drive for increased agility, and the need to compete with OTT providers.
    LRTV Custom TV
    Why SPs Should Consider Cisco's EPN

    8|27|14   |   5:40   |   (0) comments


    Sultan Dawood from Cisco discusses Cisco's EPN, which enables SPs to build agile and programmable networks delivering new network virtualized services using Cisco's Evolved Services Platform (ESP).
    LRTV Huawei Video Resource Center
    Huawei’s Showcase @ Big Telecom Event 2014

    8|26|14   |   2.56   |   (0) comments


    SoftCOM is Huawei's framework for telecom business and network transformation. Haofei Liu, Solution Marketing Manager, Carrier Business Group, Huawei, showcases Huawei's SoftCOM architecture in this video.
    LRTV Huawei Video Resource Center
    Huawei @ BTE 2014: Director of Integrated Solutions on SoftCOM & NFV Monetization

    8|26|14   |   4.43   |   (0) comments


    Libin Dai, Director of Integrated Solutions, Carrier Business Group, discusses Huawei's SoftCOM and NFV monetization. Huawei believes that NFV monetization should be service-driven rather than network-driven, and that operators should have network transformation, service transformation and a compatible and collaborative ecosystem in place in order to deploy NFV.
    LRTV Huawei Video Resource Center
    Huawei @ BTE 2014: Director of US NFV Lab on CloudEdge & the Future of NFV

    8|26|14   |   4.06   |   (0) comments


    Sean Chen, Director of US NFV Lab at Huawei, discusses Huawei's new approach to NFV in open collaboration. Huawei believes that through Proof of Concept tests, it could help operators learn and communicate with the industry more effectively. Sean believes that successful implementation of NFV should have its values reaching to end users and discusses how Huawei's ...
    LRTV Huawei Video Resource Center
    Huawei's Highlights @ Big Telecom Event 2014

    8|26|14   |   3.34   |   (0) comments


    At the Big Telecom Event in Chicago Huawei showcases its high-level strategy, the SoftCOM architecture, which helps operators reduce the cost of ownership of their network infrastructure and generate additional revenue in the ICT service environment. Huawei showcases over 30 pilot programs from across the globe, focusing on the industry-leading commercial ...
    LRTV Custom TV
    VeEX – Live from the Show

    8|21|14   |   5:58   |   (0) comments


    An overview of VeEX Test and Measurement solutions including TX300S multi-service test set with VeExpress cloud-based management system, UX400 universal modular platform supporting 100G testing, and the redesigned RXT modular platform.
    LRTV Custom TV
    Transitioning CE 2.0 Networks Into the SDN & NFV Era With Telco Systems

    8|19|14   |   5:19   |   (0) comments


    Telco Systems' Ariel Efrati (CEO) and Moshe Shimon (VP of Product Management) discuss virtualization and how the company's new Open Metro Edge solution utilizes the SDN and NFV concepts to accelerate and orchestrate service delivery through its innovative product portfolio and software applications.
    LRTV Custom TV
    NFV Myths: Is NFV Still Several Years Away?

    8|11|14   |   1:13   |   (0) comments


    Some say that NFV (network functions virtualization) is still several years away from being implemented on mobile operator networks. This isn't the case. Operators can get started on their paths to NFV now, as this short video from Skyfire shows.
    LRTV Custom TV
    A New Security Paradigm in SDN/NFV

    7|28|14   |   02:54   |   (0) comments


    Paul Shaneck, Global Director Network Solutions for Symantec, discusses the evolving virtualized network, explaining how Symantec is leading the security discussion as it relates to SDN and NFV, and helping to ensure the network is protected and compliant.
    LRTV Documentaries
    Sprint's Network Evolution

    7|24|14   |   14:59   |   (0) comments


    Sprint's Jay Bluhm gives a keynote speech at the Big Telecom Event (BTE) about Sprint's network and services evolution strategy, including Spark.
    Upcoming Live Events!!
    September 16, 2014, Santa Clara, CA
    September 16, 2014, Santa Clara, CA
    September 23, 2014, Denver, CO
    October 29, 2014, New York City
    November 6, 2014, Santa Clara
    November 11, 2014, Atlanta, GA
    December 2, 2014, New York City
    December 9-10, 2014, Reykjavik, Iceland
    June 9-10, 2015, Chicago, IL
    Infographics
    A survey conducted by Vasona Networks suggests that 72% of mobile users expect good performance all the time, and they'll blame the network operator when it's not up to par.
    Today's Cartoon
    Hot Topics
    Nokia's Maps Land on Samsung Devices
    Sarah Reedy, Senior Editor, 8/29/2014
    Now Google Planning Drones-to-Go
    Dan Jones, Mobile Editor, 8/29/2014
    Music to My Mobile
    Sarah Reedy, Senior Editor, 8/28/2014
    Be Open to the Freedom of Openness
    Kelly Herrell, 8/29/2014
    Netflix to FCC: Kill Comcast-TWC Deal
    Alan Breznick, Cable/Video Practice Leader, 8/28/2014
    Like Us on Facebook
    Twitter Feed