Thousands of movies to vanish - Once Film-Focused, Netflix Transitions to TV Shows - Yahoo! Finance

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Belying the “flix” in its name, Netflix is now primarily an Internet streaming service for television shows, not feature films.

TV series now account for more than half of all Netflix viewing. That helps to explain why this Wednesday — the long-awaited moment when motion picture classics like “Scarface” and newer hits like “Toy Story 3” will vanish from the streaming service — is not the doomsday that it was once expected to be.

The vanishing films are from Starz. Its three-and-a-half-year-old deal helped Netflix persuade millions of people to sign up for Internet streaming, hastening the company’s leap to digital distribution from physical DVDs.

It became clear about a year ago that the deal would not be renewed. By then, though, Netflix was bulking up on old TV episodes and, in a direct challenge to HBO, beginning to distribute its own original shows for the streaming service.

Analysts say the prioritizing of television partly explains why the company has been able to retain about 21.7 million streaming subscribers in the United States — totaling one in four households that have broadband — despite complaints about an inadequate feature film selection. It’s a transition that Netflix has made rather successfully in the last six to 12 months, in stark contrast to its botched plan to spin off DVD-by-mail into a separate company called Qwikster last fall.

While the end of the Starz deal is bad news for Netflix, said Richard Greenfield, an analyst at BTIG Research, “given the significant increase in TV viewing, it’s not the catastrophic event that everyone thought it would be a year ago.”
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Comments (2)

seanvcxz (L0)
Feb 29, 2012
It really seems like Netflix is down in the tubes lately. Seems like they've been making some poor decisions.
sfreestuff (L3)
Feb 28, 2012
I've had my account on hold (so they don't bill me) since the rate hike. I was considering activating my account again, but I'm debating whether this is my best option. Maybe I'll only activate it when I want to watch a movie...

For now, I only keep my account because I've rated a ton of movies and I use them for recommendations.

omegafemale: This news is sad, but thanks for posting.

This comic accurately depicts the Netflix/Qwikster mess:

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