Netflix has inked a multi-year deal with Disney to distribute its movies on pay TV beginning in 2016. Financial terms of the deal were not disclosed, but the logistics are interesting: Netflix will get the films in "the pay TV window," meaning when premium pay-cable networks like HBO and Starz would ordinarily them—typically just after the movies are made available for rent or sale but before they reach ad-supported networks. Upcoming Disney films include Oz the Great and Powerful and Monsters University.
A separate, simultaneous deal also allows Netflix access to extremely valuable Disney legacy content—films like Dumbo, Sleeping Beauty and The Little Mermaid. The move makes sense for both companies—it allows Netflix to attract a new subscriber base of parents looking for tried-and-true kids' content and to compete with Amazon (which added content from fledging pay cabler Epix earlier this year), and it allows Disney to amortize some of the losses suffered in the DVD industry in recent years with what are undoubtedly some very hefty license fees.
"Netflix continues to meet the demands of its subscribers in today's rapidly evolving digital landscape, and we are delighted that they will have much earlier access to our top-quality and entertaining slate," said Janice Marinelli, president of Disney-ABC Domestic Television Group, in a release issued this afternoon.