NetFlix today announced that it has signed revenue sharing agreements with two of the leading motion picture distributors, Warner Home Video and Columbia/Tristar Home Video. NetFlix is the first purely DVD online retailer to have revenue sharing agreements with major motion picture distributors.
Under the agreements, NetFlix is able to purchase DVD releases directly from the studios in much larger quantities, making popular new releases more readily available to their rapidly growing customer base. NetFlix, which launched its service last year, has grown to more than 250,000 members who pay $19.95 a month for its popular unlimited movie rental service.
‘With these revenue sharing deals, we can continue to deliver on our promise to provide the best movie experience possible,“ said Reed Hastings, co-founder and chief executive officer of NetFlix. ”Giving our customers the titles they want, when they want them, and allowing them to enjoy the movies for as long as they like. The agreements also help us keep pace with our extraordinary growth, without compromising our quality of service.’
‘DVD is the entertainment format of the future and NetFlix is our fastest growing customer for DVD rentals,’ said Warren Lieberfarb, president of Warner Home Video. ‘We look forward to working with NetFlix to expose the DVD viewing audience to Warner’s vast library of films.’
‘We are very excited to be working with NetFlix,’ said Steve Lyons, VP of Sales, Revenue Share of Columbia Tristar Home Video. ‘We entered into a business relationship with NetFlix because they have developed outstanding relationships with DVD viewers, many who are knowledgeable about film and looking for new ways to enhance their movie viewing experience. We believe that NetFlix is the way to introduce movie lovers to our films.’