According to Variety last week, inside sources claimed that Netflix had already decided to let go of roughly 40 miniseries because it had become too expensive to air. Ted Sarandos, chief content officer at Netflix, was quoted through a spokesman, "Content comes in and out of license periods almost daily" and that his company wants to promote programs that generate viewing, while gradually letting go of programs that do not.The industry media has compared the latest content loss to the licensing disagreement with Starz, which caused Netflix to lose airing rights to top films from Disney and Sony in February 2012. Unfortunately, the actual business impact of these losses is not easy to determine, as Netflix is still keeping audience measurement data private.
However, the failure to reach a renewal deal with Netflix might also have a negative impact on A&E networks, in the form of a significant loss of revenue and viewers, since digital services likely account for most of their off-air consumption. It is also quite possible that A&E had planned for alternative solutions in the event that their collaboration with Netflix came to an end.
While still holding steady as the industry leader, Netflix is facing more and more competition in the digital media sector as other companies like Amazon and Hulu are putting out similar services. At this time, however, A&E and History programs are not available on Hulu Plus or Amazon Prime. Some analysts have speculated that Netflix will soon have to pay for exclusivity rights as well, although international expansion has recently been the main focus for the company. In this scenario, letting go of nonessential content may actually turn out to be a good idea, as it allows the company to cut content costs.
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