Heads up, Hulu! Netflix on Wednesday announced a far-reaching licensing agreement with Disney-ABC Television Group, which will allow the rental service to stream hundreds of episodes from the ABC Television Network, Disney Channel and ABC Family.
Actually brokered by Disney-ABC Domestic Television, the deal is a boon to Netflix and its efforts to further position itself as a streaming video service.
"TV content streamed from Netflix has proven to be immensely popular with our members," said Ted Sarandos, chief content officer at Netflix.
Netflix only recently introduced its streaming-only subscription plan in the U.S., and has already signed some top content partners. In order to add "first-run" films to its catalog, the company just signed a multi-year deal with new film distribution company FilmDistrict.
As of last month, Netflix now offers customers a plan that includes the ability to view movies through its streaming service for $7.99 a month. The thriving video rental business also increased its streaming-plus-DVD-by-mail plans by $1 to $8 per month, depending on the option.
Much of Disney-ABC Television Group's content is already accessible via proprietary portals and premium content hubs like Hulu (in which Disney has an equity stake). For the entertainment conglomerate, however, additional distribution partners likely means more market presence and revenue streams.
Once made available to Netflix -- which, for relevant programming, will be no earlier than 15 days after initial telecast -- Disney-ABC episodes can now be streamed instantly with Netflix memberships starting at $7.99 a month.
Content highlights include prior season episodes of current ABC series, including "Grey's Anatomy," "Desperate Housewives," and "Brothers & Sisters," along with "Lost" and "Ugly Betty."
By the end of the third quarter, the number of Netflix subscribers who had sampled streaming online video grew from 40% to 66% year-over-year.
Overall, according to research firm Screen Digest, Netflix revenues for 2010 will be $2.2 billion.
Meanwhile, Netflix's snail-mail business will account for 35% of disc-rental spending in the U.S. this year -- up from 26% in 2009, according to Screen Digest.
Playing hardball, Hulu last month debuted its paid service Hulu Plus for $7.99 a month. The price was $2 less than originally planned, and undercut the entry cost of Netflix's service -- before Netflix responded with a price drop of its own.
From the Disney Channel, per the new deal, highlights include "Phineas and Ferb" and "Good Luck Charlie," along with "The Suite Life on Deck" and "Wizards of Waverly Place."
From ABC Family, Netflix subscribers can expect "Greek," "Make It or Break It," "The Secret Life of the American Teenager," and "Melissa & Joey."