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Old 04-05-2011, 10:07 PM
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Default Netflix to stream Mad Men

Wow! Mad Men and working on Miramax and NBCU deal.

So much for Hollywood not working with Netflix. Especially since they already have a deal with Sony and Disney (via Starz) and with Paramount and Lionsgate (via Epix).

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Lions Gate Entertainment Corp., which produces the hit television series "Mad Men," struck a deal with Netflix Inc. to stream all seven seasons of the critically acclaimed show about a 1960s advertising agency.

The deal is worth between $75 million and $100 million, people close to the situation said. That means Netflix is paying close to $1 million per episode of the series, which "Mad Men" creator Matthew Weiner said last week would run seven seasons. Each season has 13 episodes, which Lions Gate licenses to cable network AMC.

The new agreement marks the latest deal that Netflix has struck with a film and television studio. The company has recently inked a slew of deals to add new content to its streaming site, including one with Miramax, which includes "Pulp Fiction" and other iconic independent movies.

Netflix is also in discussions with Comcast Corp.'s NBCUniversal over a new content deal, according to people familiar with the matter. If reached, a deal would include TV episodes from earlier seasons of NBCU's cable and broadcast shows and be non-exclusive, the people said. Financial terms on the table couldn't be learned but one of the people said a deal would dramatically expand the amount of NBCU content offered through the service.

A Netflix spokesman earlier declined to comment about an NBCU deal. The spokesman later didn't return multiple requests for comment about a "Mad Men" deal. In a recent interview, Netflix chief content officer Ted Sarandos said "stay tuned" when asked when the company would secure Internet rights for the series.

Under the "Mad Men" deal, viewers will be able to stream the first four seasons of "Mad Men" on Netflix around mid-July. Once the final episode of the fifth season finishes airing on AMC in 2012, episodes from that entire season will also be available on Netflix. The sixth and final seasons of "Mad Men" will follow a similar pattern.

http://online.wsj.com/article/SB1000...457993318.html
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Old 04-05-2011, 10:38 PM
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So much for Hollywood not working with Netflix.
If Netflix is going to let content providers rape them for 75-100mil per show, I'm sure all the lads will come a callin'
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Old 04-05-2011, 10:50 PM
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If Netflix is going to let content providers rape them for 75-100mil per show, I'm sure all the lads will come a callin'
At least the per episode price is a bit better for this one. What was the other one, $4M per?
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Old 04-05-2011, 10:59 PM
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At least the per episode price is a bit better for this one. What was the other one, $4M per?
If you actually investigate, the estimates of House of Cards were too high with the actual price as much as half the cost (the $100 million estimate was based on production costs of shows like Rome).


And if you are paying attention to Netflix financials, the cost of this deal is less than the revenue generated from NET new subs in one month across the year, which doesn't even take into account the cost savings from their 20 million (plus 2-3 million in Q1) dramatic drop in disc shipments per subscriber.

But we will know more in a few weeks when we see their latest financial numbers. :-)
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Old 04-05-2011, 11:07 PM
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If Netflix is going to let content providers rape them for 75-100mil per show, I'm sure all the lads will come a callin'
Even more interesting is their recent trends to dodge investor's questions on all of these new expenses.

Rather telling.
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Old 04-05-2011, 11:09 PM
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But we will know more in a few weeks when we see their latest financial numbers. :-)
Actually those numbers won't tell much of anything as most of these new expenses won't have hit their bottom line yet.

The really interesting reports will be the one 6-12 months down the road.
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Old 04-05-2011, 11:13 PM
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Actually those numbers won't tell much of anything as most of these new expenses won't have hit their bottom line yet.

The really interesting reports will be the one 6-12 months down the road.
LOL - especially when their subscribers total over 30 million.
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Old 04-06-2011, 09:58 AM
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LOL - especially when their subscribers total over 30 million.
As I have stated numerous times, Netflix manages their business (including acquisitions) to hit a margin goal. This year the goal is 14%.

As their revenue grows (and their other costs as a percentage of margin go down), their buying power for streaming goes up significantly.
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Old 04-06-2011, 12:44 PM
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Home Media Magazine coverage:

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Deal includes recently announced seasons 5 and 6

Emmy Award-winning series “Mad Men” may be on hiatus, but that didn’t stop Netflix April 5 from announcing it secured U.S. streaming rights to all four seasons of the popular drama.

The Los Gatos, Calif.-based online disc rental pioneer will begin streaming episodes July 27. Media reports suggest Netflix paid as much as $1 million per episode in license fees.

Set in 1960s New York, "Mad Men" follows the lives of the ruthlessly competitive men and women of Madison Avenue advertising. The ensemble cast includes Golden Globe-winner Jon Hamm, January Jones, Elisabeth Moss, Vincent Kartheiser, Christina Hendricks, John Slattery, Jared Harris, Rich Sommer, Aaron Staton, Robert Morse and Kiernan Shipka.

“This deal secures long term instant access to an iconic show for Netflix members for years to come,” said Ted Sarandos, chief content officer with Netflix.
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“We have ensured 'Mad Men's' value for years to come by layering today's unique syndication deal with a leading digital distribution partner on top of last week's licensing agreement with AMC,” said Lionsgate president Steve Beeks.

He said transactional video-on-demand and related syndication plans for “Mad Men” would be announced shortly.

Eric Wold, director of research with Merriman Capital in San Francisco, said the deal, along with the recently announced “House of Cards” exclusive series, underscores how big Netflix has become.

“With many consumers subscribing to HBO and Showtime primarily for access to certain original programming series (“Sex and the City,” “The Sopranos,” “Boardwalk Empire,” etc.), we believe this move by Netflix could not only draw new subscribers (due to the low $7.99/month cost), but also give another strong reason for churn to stay low,” Wold wrote in a note.

He projects netflix will end 2011 with 32.4 million subs, including 29 million domestically.
http://www.homemediamagazine.com/net...-mad-men-23551
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Old 04-06-2011, 07:32 PM
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CNBC Coverage:

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Netflix Grows Streaming Video; Lionsgate Innovates

Lionsgate's deal to distribute 'Mad Men' on Netflix after its run on AMC is more than just a syndication deal — It speaks to the growth of streaming video and the fact that Hollywood is starting to think outside its box.

Netflix is the new Cable

Netflix is replacing a broadcast or cable channel, which would normally syndicate 'Mad Men.' Lionsgate is getting a better deal from Netflix -- nearly $1 million an episode, compared to the roughly $250,000- $300,000 it was paid a few years ago for its "Weeds" syndication deal. It becomes an increasingly good deal for Netflix -- the more subscribers they add, the lower the per-subscriber content cost.
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The good news for Netflix. The company is expected to double the amount it's estimated to pay for programming to $1.1 billion (and this report was written before the Lionsgate deal). But on a per-subscriber basis, Netflix is only paying a fraction of the amount for content that cable companies pay. Last year Netflix paid about $34 per subscriber for content, while cable and satellite TV providers paid more than ten times that. The percentage gap isn't as huge-- this year Netflix will pay 39 percent versus the 42 percent cable companies pay.
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Meanwhile this speaks to Lionsgate's willingness to think beyond the traditional rules by which studios play. Why not treat Netflix streaming as a syndication vehicle?

This follows another innovative move from one of the few publicly traded pure-play studios. Lionsgate partnered with Groupon to offer discounted tickets to 'Lincoln Lawyer,' in March, the first deal of its kind. This had a notable positive impact on the film's ability to hold on-- its box office gross fell just 18.6 percent between the first and second weekend at the box office, an unusually small drop.

It's been a good few weeks for Lionsgate. Just last week it extended its deal with hit filmmaker Tyler Perry. The contract includes both theatrical release as well as home video. And as we've seen with this 'Mad Men' deal, these days content seems to reap most of its returns after its initial run.
http://www.cnbc.com/id/42459746
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