Peter Kafka

Recent Posts by Peter Kafka

Amazon’s Lovefilm Strikes Disney Deal

Lovefilm, the “Netflix of Europe,” now has something Netflix doesn’t have–a deal with Disney to stream the studio’s movies.

Netflix does carry Disney’s stuff on its Web service. It has the ability to show Disney movies, like “Toy Story 3,” via a deal with the Starz pay network that expires in less than a year. It also has access to some Disney/ABC TV shows.

But Lovefilm, which became a wholly-owned unit of Amazon earlier this year, now has a direct deal with Disney to stream its older movies via its subscription service, and can sell newer titles, like “Tangled,” on pay-per-view.

The deal is incremental for Lovefilm, and it’s not exclusive. But it does underscore how much work Netflix will have to do if it wants to expand outside of North America–a goal the company has said is important to its future success.

That’s because few, if any, of the company’s existing rights deals will work outside the U.S. Which means it has to cobble together new deals, which takes time and money.

That’s a difficult process. Just ask Hulu, which has yet to figure out how to port its Web video service outside the U.S., despite the backing of Disney, News Corp. and Comcast (News Corp. also owns this Web site). But Netflix seems to be going into this with open eyes–it says it plans to invest as much as $50 million into international expansion this year.