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Nine Entertainment Set To Struggle With Content

By David Richards | Monday | 09/12/2013

Attempts by the Nine Network to launch a new video on demand service similar to what Netflix delivers in the USA could face problems with several major studio's refusing to release the online rights to content in Australia.

During the past week several executives from major Hollywood studios have told SmartHouse that the reason that Netflix has not launched in Australia is that the US Company has been unable to get the rights to TV programs and first run movies for Australia.

Nine Entertainment who listed last week on the ASX is hoping that arch rivals Seven and Ten will allow their content to be available on the new service. Currently Seven and Ten along with Foxtel hold the Australian rights to several TV shows and movies that the Nine Entertainment and Netflix do not have the rights to in Australia.

The new subscription video-on-demand service is tipped to launch in the second half of next year however observers claim that at this stage the only movie content the network will have is catalogue content similar to what Fetch TV, Google and Apple currently offer to customers. Also offering the same content is Telstra with their T Box and Quickflix.
The media company has told investors it has drawn up plans for a Netflix-style customer proposition, led by former Ninemsn executive Mike Sneesby.

According to the Australian newspaper Sneesby was chief executive of online group buying company Cudo, which Nine exited earlier this year.

The streaming service will look to attract customers with no contracts, and simple pay-as-you go monthly passes.

Programming will include Australian drama, children's shows and an archive of movies from Hollywood studio Warner Brothers, the Harry Potter series and The Dark Knight trilogy all content that Nine Entertainment currently has the rights to
Nine's service will not offer users so-called "tier one" movies under its Warner Bros deal, which means the service will not be able to offer movies until nine months after their cinema release. The costs of acquiring the rights are considered too expensive for a service that will be competitively priced.

The Australian newspaper claims that the danger is that free-to-air broadcasters risk cannibalising their valuable mass audiences, but with Netflix, Hulu and Amazon all expected to arrive by 2016, they have been left little choice.

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