Comcast and Netflix escalate fight for viewers
America’s largest cable operator and largest online video company are heating up the battle for the country’s eyeballs.
Comcast Corp. unveiled plans Tuesday to launch an online video-on-demand subscription service featuring thousands of TV re-runs and older movies for a flat monthly fee. Netflix Inc., the pioneer of that business, announced a deal to stream movies from Weinstein Co., including the Oscar favorite “The Artist.”
The flurry of announcements demonstrates the fervor with which traditional video providers like Comcast and cutting-edge ones like Netflix are seeking to attract and retain consumers who have a growing number of entertainment viewing options.
The two companies are fighting for dominance in an increasingly crowded field of competitors, among them Dish Network, DirecTV, Verizon Inc. and Amazon.com.
Comcast’s new digital subscription offering, called Xfinity Streampix, launches this week and allows users to watch content on televisions and Internet-connected digital devices like smartphones. It will be free to customers who subscribe to Comcast’s video, Internet and phone service, and cost $5 to those who get only TV from the company. Netflix streaming costs $8 a month.
Although the new service will inevitably draw comparisons to Netflix, and spurred a 4% drop in that company’s stock Tuesday, there are notable differences.
Xfinity Streampix — which features TV shows like “30 Rock” and “Grey’s Anatomy” and movies such as “Brokeback Mountain” and “Ocean’s Eleven” — doesn’t come close to the more than 14,000 titles available to stream from Netflix, according to the site InstantWatcher.com. Netflix also has exclusive deals for TV shows like “Mad Men” and independent films like last year’s Ryan Gosling drama “Drive.”
Also, while anyone with an Internet connection and a digital device can access Netflix, Xfinity Streampix is currently available only to the 22.3 million homes nationwide that have Comcast television service, including homes in San Francisco, Oakland and Sacramento. (Los Angeles is not part of the Comcast territory.)
Comcast has the rights to offer some of the content on its new Xfinity service nationwide, but, according to Marcien Jenckes, Comcast’s general manager of video services, has no plans to do so: “It is not at all our intention to compete with Netflix.”
Among cable companies, Comcast has been the most aggressive in adding services to respond to the explosion of digital devices while trying to retain its core customers. Comcast last month negotiated a comprehensive deal for movies and TV shows from Disney/ABC Television.
“This just makes our existing subscriptions more valuable,” Jenckes said.
This new service is separate from Comcast’s Xfinity On Demand, which offers more recent movies available to consumers on a per-title basis.
Netflix, meanwhile, continues trying to bolster its lineup of original content that isn’t offered by competitors Comcast, Dish Network-owned Blockbuster, Hulu, HBO and Amazon.com.
This month, kiosk DVD rental company Redbox and telecom giant Verizon announced plans for another competing venture, a video subscription service that will launch this year.
The multi-year Weinstein Co. deal gives Netflix a number of modest box-office performers, many of them documentaries and foreign-language pictures, that appeal to niche audiences who have proved to be avid users of on-demand services.
In addition to “The Artist,” the deal includes the historical dramas “Sarah’s Key” and “W.E.” and the upcoming documentary “Undefeated.” But Netflix will not get Weinstein Co.'s English-language movies, such as “My Week With Marilyn,” which are covered under an existing deal the company has with Showtime.
Netflix is also in talks to hire HBO veteran executive Colin Callender to help add to its small but growing collection of original content.
The company launched its first series, “Lilyhammer,” this month, and has at least five other shows in the works.
If he strikes an arrangement with Netflix, Callender would produce the first original mini-series and/or movies for its popular online streaming service. Callender, who left his post as president of HBO in 1998, declined to comment, as did a spokesman for Netflix.
Comcast Corp. also announced Tuesday that it would launch four independent channels targeting minorities in the next two years. They include one owned by former Lakers star Magic Johnson, one owned by former rapper and entrepreneur Sean “Diddy” Combs, and a third owned by “Spy Kids” director Robert Rodriguez.
Revolt, the proposed channel backed by Combs and former MTV executive Andy Schuon, is planned for a 2013 launch. Rodriguez’s El Rey channel, a joint venture with FactoryMade Ventures executives John Fogelman and Cristina Patwa is scheduled to launch within two years.
The fourth channel, BabyFirst Americas, is backed by Spanish-language television veteran Constantino “Said” Schwarz and will debut in April.
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