TV in the Cloud - Part 2

People think that the Internet will destroy cable television and broadcast television. I hear tons of people say "it will happen someday." While people say that, I am not sure they understand what they are saying. There are too many moving pieces for one company like Netflix to change how everything works.

I think a great example of this is the deal with Netflix and Starz falling apart. The problem is Starz is not making any movies. They are making very limited new content.

Starz was feeling pressure from Hollywood studios such as Disney and Sony Entertainment, who don’t like their movies going to Netflix for cheaper than what they are able to charge in DVD sales and in fees to cable partners, according to Barclays analyst James Ratcliffe in a research note Friday.

Since the people who make and own the content do not want the content on Netflix, at lease without a direct deal with Netflix. Just having the rights to today's content is no guarantee that you will have the rights to the content that comes out next year.

There is always new content to be made and paid for. Often that content needs a fresh deal. That is one of the things that makes the way the internet and silicon valley works different than the content industry. That is why Television and Movie Studios are dragging their feet.


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