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Hollywood Versus Netflix’s ‘Watch Instantly’

So you’ve stockpiled canned goods and potable water, blacked out all the windows in your house, and re-upped your Netflix subscription for hours of sedentary entertainment via their “Watch Instantly” option — congratulations, you’re ready to become a full-time hermit! That is, if Hollywood cooperates. Turns out, the big studios aren’t exactly ready to give Netflix all their best flicks. It’s the same old story, only more complicated.

And the main issues are:

• The studios are wondering if they even need Netflix. Couldn’t they just offer up movies on their own (currently wholly theoretical) streaming services? Hey, that’s forward thinking!

• But do they even want to offer streaming? Yeah, DVD sales are taking a hit, but they’re still the most profitable part of the process (80 percent of each sale goes to the studio). Couldn’t they just buckle down and pretend nothing was changing? Okay, big step back.

• There’s also the issue of screwing up the structure as it currently stands, with movies going from stores to premium cable to basic cable and then to broadcast TV. “Where does streaming fit in?” the studios ask. So, still not really seeing the big picture, huh?

• Also, Netflix pissed off the studios last year by securing the rights to Disney and Sony movies through a backdoor agreement with Starz and not a direct deal. For their part, Netflix does sound a little apologetic.

• Which means, with the right amount of schmoozing, it should all work out. Apparently, Jeffrey Katzenberg hung out with a bunch of Netflix execs in May, where they all watched 3-D movies. Old Hollywood, meet New Hollywood! This hermit thing might work out yet.

Netflix Envoy Pitches Online Films to Wary Studios [Bloomberg via /Film]

Hollywood Versus Netflix’s ‘Watch Instantly’