Netflix Loses Epix Movies, For Good Reason

Come September 30th, everyone’s favorite streaming service — Netflix (and chill) — is about to get a little lighter on the “flix” side of the house.

That’s because the company’s long-term deal with Epix (a joint venture of MGM, Lionsgate, and Paramount studios) will conclude at the end of the month. Current Netflix movies provided by Epix include “Hunger Games: Catching Fire” and “Transformers: Age of Extinction”. Starting in November, Epix flicks will move to Hulu (though, they already are available through Amazon Prime and Epix’s own cable networks). 

In a blog post yesterday, Netflix CCO Ted Sarandos announced the dissolution of the Netflix/Epix partnership, adding, that though some of the Epix titles are popular, “they are also widely available on cable and other subscription platforms at the same time as they are on Netflix”.

Sarandos goes on to say that “through our original films and some innovative licensing arrangements with the movie studios, we are aiming to build a better movie experience for you”. This includes the Adam Sandler partnership announced last year, in addition to a lucrative agreement with Disney for exclusive first-run TV rights in 2016 — a deal that includes Pixar and Marvel releases.

While missing out on “Hunger Games” may irritate subscribers in the short-term, Netflix’s own long-view manifesto positions the company not as a one-stop convenience store, but rather, a specialty market. Sarandos himself has stated that securing the rights to (expensive) live events — sports, for example — doesn’t fit the company’s vision. Instead, they’d rather focus on exclusive “TV” content (House of Cards, Orange is the New Black for example), original movies (like Pee-Wee’s new flick next year), and first-rights to theater releases.

Near-term implications of Netflix eschewing Epix content may cause ripples; however, they are hoping their anticipated $6B in content investment in 2016 will pay off, and help subscribers forget about losing a little bit of inventory that’s already available elsewhere.

Which brings me to another point: when Netflix loses Epix moves on September 30th, only a small quantity of movies will actually disappear from the platform. There are but a few flicks on Netflix distributed by Epix at this time (“Hunger Games”, “World War Z”, and “Transformers” topping that list) — all of which are featured heavily on Epix network channels and Amazon Prime.

As with any major change, expect squeaky-wheel subscribers to be the most vocal. Over time, though, I can’t see how Netflix doesn’t come out on top by dropping Epix movies.

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