Netflix shares fall after losing TV shows and films such as The Social Network

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US cable broadcaster Starz ended contract renewal negotiations with video-streaming site on Thursday

Netflix shares fell as much as 9% in after-hours trading late on Thursday after the video-streaming site lost one of its major US cable TV suppliers of content, along with thousands of blockbuster films including The Social Network.

The US cable broadcaster, Starz, abruptly ended contract renewal negotiations with Netflix on Thursday after the companies failed to reach a deal to stream new films.

In a statement, Starz said: "This decision is a result of our strategy to protect the premium nature of our brand by preserving the appropriate pricing and packaging of our exclusive and highly valuable content."

The collapse in talks means thousands of movies from studios including Disney and Sony will be pulled from Netflix on 28 February. It comes just months after Netflix described the Starz contract as "one of our most important deals".

A spokesman for Starz added: "With our current studio rights and growing original programming presence, the network is in an excellent position to evaluate new opportunities and expand its overall business."

Netflix, which also has an online DVD rental business, and Starz have been in talks for months for extend the contract, which was struck in 2008.

A handful of Sony titles disappeared from Netflix in June, a result of what the streaming site called a "temporary contract issue" between the companies.

The loss of the Starz output deal comes after a tumultuous few months for Netflix, as the streaming sites's continued popularity has been matched by content owners hiking the price of licensing their films. Some film studios have imposed 30-day delays before Netflix can access new films on DVD.

Netflix has been forced to twice raise the amount it charges its 23 million subscribers to watch films, as chief executive Reed Hastings has made clear his determination to bolster the firm's library of content.

• Digital media
• Media business
• Television industry
• US television industry
• Television
• Television
• Internet
• US television

Josh Halliday

guardian.co.uk © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds

02 Sep, 2011

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Source: http://www.guardian.co.uk/media/2011/sep/02/netflix-shares-losing-films
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