Netflix, Relativity Media sign deal to stream first-run movies

Netflix has inked a deal with media and entertainment company Relativity Media, giving Netflix exclusive access to stream Relativity-controlled first run movies during the "pay-TV window," the same access premium channels like HBO and Showtime have had.

The deal marks a continued shift in the distribution of major motion pictures in the U.S. Under the agreement, an increasing amount of contemporary movies previously encumbered by pay TV agreements 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.

Netflix, which has some 14 million subscribers to its by-mail DVD service in the United States, also streams movies instantly to some 7 million households on TVs, PCs and mobile devices like the iPad and smartphones.

Among the first wave of films covered under the 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 on 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.  50 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.

"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."

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