Netflix to delay new releases from 2 studios

Los Angeles Times Staff Writer

Netflix customers who want to see “Avatar” or “It’s Complicated” on DVD will have to wait for more than just their mailman.

20th Century Fox and Universal Pictures have signed new distribution deals with the DVD-by-mail service that include a 28-day delay on new releases.

The agreements are similar to one signed by Warner Bros. with Netflix in January. As with that agreement, the Fox and Universal deals give Netflix more favorable financial terms on new releases in exchange for the delay.

The company is using the savings to acquire more movies from the two studios for its Internet streaming service, which it has said is crucial to the future of the company as more consumers switch from DVDs to watching movies online.

Fox also will provide some of its TV shows to Netflix for Internet streaming for the first time.

Fox, Universal and Warner have taken the lead in publicly lambasting DVD kiosk company Redbox, arguing that low-cost new-release rentals undercut the home entertainment business.

Fox and Universal are still embroiled in a legal battle with Redbox, whereas Warner signed a deal with it last month that also included a 28-day delay for new releases. Fox and Universal want to impose a similar delay on Redbox.

Other studios are expected to follow the leads of Fox, Universal and Warner, and sign similar deals with Netflix and Redbox in the future.

That will set up a situation in which consumers can rent DVDs only when they go on sale from physical retailers such as Blockbuster, which recently signed deals with Warner, Fox and Sony Pictures that guarantee it can offer new releases at launch.

The first new movies that will be covered by the new Netflix deals are the most popular ones released by Fox and Universal in theaters around the 2009 holiday season: “Avatar” and “It’s Complicated,” which will go on sale April 22 and 27, respectively.