The battle over film licensing exclusivity transpired as expected once Netflix transitioned from a content aggregator to a content creator. One-by-one the major studios built direct-to-consumer streaming services to compete with Netflix.
Once their third-party licensing deals expired, the content was licensed in-house to prevent Netflix, Amazon, and others access to new releases and popular library titles.
Sony Pictures Wisely Splits Film Rights Between Netflix and Disney
Netflix emerged as the winner in a nearly two-year auction process for the exclusive U.S. rights to stream Sony’s theatrical releases in the lucrative Pay-One Window, which started with the studio’s 2022 slate. Typically, the Pay-One Window lasts 18 months and follows theatrical and home entertainment windows that have significantly contracted in recent years.
Before its deal with Netflix, Sony’s PayTV partner was Lionsgate-owned Starz, which started in 2006. Learn more about the Starz Pricing Guide, which provides rate cards and terms for feature films available for Pay-One and SVOD exhibition released from 2014 to 2020.
Starting last year, all films from the various Sony banners, including Columbia Pictures, Sony Pictures Classics, Screen Gems, and TriStar Pictures, will stream exclusively on Netflix in the United States after theatrical and home entertainment windows. Sony has decided to hold onto international streaming rights for a more piecemeal licensing approach.
The agreement also provides Netflix a first-look at Sony’s original films produced for the direct-to-streaming market, which start upon signing in April 2021. However, Netflix has the right to refuse any title freeing Sony to pursue other streaming partners.
Like most licensing agreements, the deal is structured traditionally, whereby Netflix pays for each film determined by rate cards on a sliding scale by each title’s box office receipts. As part of the agreement, Netflix will also license an unspecified number of older titles from Sony’s film library.
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Weeks after its deal with Netflix, Sony Pictures reached a major licensing agreement with Disney to offer both feature and animated films in the Pay-Two Window for its theatrical slate from 2022-2026.
After the Pay-One Window with Netflix, most of Sony’s film library will be available on Disney’s streaming and TV platforms, including Disney+, Hulu, ABC, Disney Channels, and FX. Before the most recent mega-deal, Sony only licensed its films to Disney-owned FX in the post-Pay-One Window.
Sony is the only major studio without a direct-to-consumer streaming service. It has wisely declared that it will focus on supplying content to others rather than wading into the profit-challenged streaming wars.
Major Film Licensing Agreements in the U.S.
| Film Studio | Film Slate | Pay-One Window | Pay-Two Window |
|---|---|---|---|
| Disney | Disney | Disney+ | N/A |
| Disney | 20th Century Fox / Searchlight | Disney+ / Hulu / HBO / HBO Max | N/A |
| Lionsgate | Lionsgate Films | Starz | N/A |
| Lionsgate | Summit | Starz | N/A |
| MGM | MGM | Epix | Amazon / Paramount+ |
| Paramount | Paramount | Paramount+ | Amazon / Epix |
| Sony | Sony Pictures | Netflix | All Disney Platforms |
| Universal | Animated Films | Peacock / Netflix | Netflix |
| Universal | Live-Action Films | Peacock / Amazon | Starz |
| Warner Bros. | Warner Bros. | HBO / HBO Max | N/A |
Starz Must Settle for Universal’s Pay-Two Window
After losing its long-standing Pay-One Window rights to Sony’s films, Starz was able to secure the Pay-Two Window to Universal’s film slate beginning in 2022. The deal gives Starz access to live-action films from Universal Pictures, Focus Features, and Blumhouse.
In the Pay-One Window, Universal’s films from 2022 and beyond will remain in-house with its Peacock streaming service. The Pay-One Window will start 120 days after the theatrical release for four months and again during the last four months of a film’s 18-month Pay-One Window.
Amazon Prime Video has exclusive rights to stream Universal’s live-action films during the middle ten-month period (months 5-14) of the 18-month Pay-One Window with Peacock. Notably, Netflix shares Pay-One rights with Peacock to Universal’s animated films.
Following the theme of keeping rights in-house, Starz secured Pay-One Window rights to films released by Lionsgate and Summit, which started at the end of 2021 and 2022, respectively.
FilmTake Away: Studios Keep Film Content In-House
The battle over film licensing exclusivity transpired as expected once Netflix transitioned from merely a content aggregator to a content creator. One-by-one the major studios built direct-to-consumer streaming services to compete with Netflix. Once their third-party licensing deals expired, film content was primarily licensed in-house to prevent Netflix, Amazon, and others access to new releases and popular library titles.
While the major studios go in-house, independent film and television producers will have more opportunities than ever to license content in various windows to a growing number of streaming services around the world.