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Edition: U.S. Article Comments (0) Email Print Reprints Read Wikileaks' Assange in UK, police know where: report 01 Dec 2010 Amazon stops hosting WikiLeaks website 01 Dec 2010 Elizabeth Smart storms out of kidnapper's trial 01 Dec 2010 Top U.S. military officer presses China over North Korea 01 Dec 2010 Elizabeth Smart storms out of kidnapper's trial 01 Dec 2010 Discussed 71 Saudi king urged U.S. to attack Iran: WikiLeaks 64 South Korea names security adviser as defense minister 64 Obama to propose two-year federal worker pay freeze Watched Bejeweled bra exposed in NY Thu, Oct 21 2010 Row over vote orgasm video Fri, Nov 19 2010 World reacts to WikiLeaks release Mon, Nov 29 2010 Analyst Research Report Title Price Trading Report for (TWX). A detailed report, including free correlated market analysis, and updates. 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Full Article More Green Business headlines Netflix scrambles future of TV and films Tweet This Share on LinkedIn Share on Facebook By Sue Zeidler NEW YORK (Reuters) - Hollywood, which embraced Netflix Inc just a few years ago as a savior, is moving quickly to stanch the growth of one of the media's newest, biggest stars. Senior executives at three of the big six television and... Related News Key quotes Reuters Global Media Summit Mon, Nov 29 2010 Microsoft eyes leap back into TV: sources Mon, Nov 29 2010 UPDATE 1-Reuters Summit-Microsoft eyes leap back into TV-sources Mon, Nov 29 2010 Key quotes from the Reuters Global Media Summit Mon, Nov 29 2010 Video, newspapers aim to avoid music fate Fri, Nov 26 2010 Related Topics Technology » Media » Stocks Netflix Chief Executive Officer Reed Hastings speaks during the launch of streaming internet subscription services for movies and television shows to televisions and computers in Canada, at a news conference in Toronto September 22, 2010. Credit: Reuters/ Mike Cassese By Sue Zeidler NEW YORK | Wed Dec 1, 2010 6:08pm EST NEW YORK (Reuters) - Hollywood, which embraced Netflix Inc just a few years ago as a savior, is moving quickly to stanch the growth of one of the media's newest, biggest stars. Senior executives at three of the big six television and movie studios said they were seeking ways to contain Netflix -- from delaying when Netflix can make new DVDs available to rent to raising the prices for digital programs. "The problem is that Netflix is not the company we thought it was when we started doing these deals a few years ago. It has changed," said a studio executive who requested anonymity because the studio's discussions were confidential. Netflix, whose stock has jumped nine-fold over the past two years, is a leader in U.S. DVD rentals with its service that sends movies and TV shows through the mail. Its streaming service is also growing quickly, and accounts for one-fifth of U.S. Web traffic in peak hours. Studio executives have expressed disbelief over some of Netflix's Hollywood content coups, like its 2008 deal with Liberty Media Corp-owned Starz to offer films from Sony Corp and Walt Disney Co for $20 million to $30 million. That deal put Netflix's streaming service on the map for a fraction of what cable operators had paid Starz. "The deal Starz did to give those movies away for $30 million obviously makes no sense. There's a day coming shortly when that deal expires. How do Starz and Netflix address the next deal?" News Corp Chief Operating Officer Chase Carey said this week at the Reuters Global Media Summit. NOT A VIABLE WINDOW Media executives also worry Netflix could bring on a re-run of what happened in the music business when Apple Inc, maker of the iPod, wound up dictating prices. "Timing really matters," said Strauss Zelnick, chairman Take-Two Interactive at the Reuters Media Summit. Zelnick said studios, to protect profits, must be careful to maintain control over when movies and TV shows are released on DVD or to cable. This is commonly referred to as windowing. "Windowing is just a fancy word for price discrimination," he said. Netflix, with deep pockets and a willingness to pay heavily for content, is succeeding where Google Inc, Apple and studios have so far failed -- developing a viable business for digital movies and films. Scenarios under review, according to executives, include curtailing Netflix's influence by delaying further the 28 days Netflix now waits to get newly released DVDs from some studios. Another is raising prices Netflix pays for digital rights. "I don't think long-term the 28-day window is viable for the industry," said another senior studio executive who was also involved in confidential talks with Netflix and asked not to be named. "Either push it out further or don't concede as much on price. We're looking at a better way to slice it." Time Warner Inc Chief Executive Officer Jeffery Bewkes recently said extending the delay to Netflix was under consideration. "The question of whether we ought to go longer is very much under scrutiny. It may well be a good idea," he said on a recent call with analysts. 1 2 Next Technology Media We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language, all capital letters or appear to be spam, and we review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. Comments (0) Be the first to comment on reuters.com. Add yours using the box above. 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Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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