Netflix has signed a high-profile content deal with Dreamworks, although the deal reportedly won’t kick in until 2013.
Dreamworks is the home of hit animations such as Shrek and How to Train Your Dragon. The deal is likely to bring a considerable number of popular films onto the Netflix platform for the first time, and the announcement signals some good news for Netflix at a time when the company is facing greater pressure from rival streaming services.
Will Dreamworks deal save Netflix?
Netflix has seen some pretty stunning subscriber growth in recent years, and that will be hard if not impossible to sustain. Some suggest that Netflix’s problems go deeper, and that the company is struggling to hold onto the vital bundles of content that will encourage subscribers not to jump ship.
Last week, Netflix made the high-profile announcement that it is spinning off its DVD rental business into new company Qwikstar. The news was greeted with some surprise, and questions have been raised about whether Netflix has made the right decision.
The Dreamworks deal is certainly good news for Netflix, but the question is whether it’s enough. The loss of that Starz deal earlier this year was arguably quite a big hit and the Dreamworks deal might not be sufficient replacement on its own. Some analysts suggest that Netflix is on a knife-edge with regards to whether or not it can become the dominant streaming service or just one of many.