Netflix’s Internet video service is adding more marquee attractions as it braces for a new competitive threat from cable-TV provider Comcast Corp.
As part of an effort to offer more exclusive material, Netflix locked up the right to show “The Artist” and other movies from The Weinstein Co. before the films are released to leading pay-TV channels such as Showtime and HBO.
Just a few hours after Tuesday’s announcement about that multiyear deal, Comcast unveiled plans to undercut Netflix with a less expensive version of a service that will stream old TV series and movies to devices with high-speed Internet connections.
The Comcast service, called Xfinity Streampix, will be available this week to the company’s subscribers. It will cost $5 per month, below Netflix’s $8 monthly price for its Internet-streaming service. Some Comcast customers who pay for multiple services, including high-speed Internet access and phone, will get Streampix at no additional cost.
Although it appears Netflix’s library is more extensive, Streampix could be good enough for some households looking to supplement their cable-TV service with a package that has on-demand video on computers and mobile devices.
That possibility apparently unnerved some investors who have long worried about Netflix losing its early lead in Internet video as more rivals enter the market. Netflix’s stock lost $4.45, or 3.7 percent, to close Tuesday at $117.40.
Comcast, which is based in Philadelphia, will join two other large companies, Amazon.com Inc. and Wal-Mart Stores Inc., already offering video streaming services. Earlier this month, Verizon Communications Inc. announced that it is teaming up with Redbox’s DVD rental-kiosk network to introduce an Internet video service later this year. The pricing for the Verizon-Redbox venture hasn’t been disclosed.
Netflix CEO Reed Hastings has said that he views cable TV as his company’s biggest worry. So far, Hastings has identified Time Warner Inc.’s HBO channel as Netflix’s toughest competition, but that could change if a cable provider such as Comcast can develop a compelling service.
By countering Netflix, Comcast hopes to hold on to customers, many of whom have been canceling their cable subscriptions to save money. Some of those former subscribers have been able to get their entertainment fixes from Netflix, whose Internet streaming service began this year with 21.7 million U.S. subscribers.
Comcast, by contrast, had 22.3 million video subscribers after losing 459,000 customers last year.
Based on the line-up included in Tuesday’s announcement, Streampix will have much of the video already available on Netflix. The list of overlapping selections includes the past seasons of popular TV series such as “The Office” and “Lost” and older movies such as “Brokeback Mountain” and “The Big Lebowski.”
Recently, Netflix has been trying to differentiate itself by buying the rights to more original series — a strategy that has worked well for HBO and CBS Corp.’s Showtime.
I switched my Netflix account to streaming only and went to Blockbuster to get my DVDs in the mail…..I get new releases faster AND I can exchange them in store for Blu-Ray or games. I found that unless I truly want to watch something like a television series, then there is no need for netflix since they do not carry many new releases.