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Starz Posts Flat Q4 Operating Income

27 Feb, 2013 By: Erik Gruenwedel

Non-renewal of Netflix SVOD agreement affects quarterly revenue

Starz Feb. 27 reported fourth-quarter (ended Dec. 31) operating income of $86 million, which was down 2% from operating income of $87 million during the previous-year period. Revenue dipped 2.5% to $422 million from $432 million last year.

The Englewood, Colo.-based premium TV content aggregator, which split off from Liberty Media last December, attributed the declines in part to the non-renewal of the subscription video-on-demand agreement with Netflix.

The groundbreaking deal, which helped Netflix launch the SVOD business partly with access to Sony Pictures and Disney movies, expired in February 2012.

Starz has premium TV rights to Disney movies through 2016. It just renewed its rights with Sony Pictures through 2021.

Starz had no new original series launch in the quarter compared to the debut of “Boss” during the previous-year period.

CEO Chris Albrecht said Starz continues to roll out its proprietary “Play” TV Everywhere platforms, inking agreements with Cox Communications, DirecTV, AT&T U-verse TV and Verizon FiOS TV.

Starz Original series include “Da Vinci’s Demons,” “Magic City” and “The White Queen.” The final installment of the “Spartacus” franchise, Spartacus: War of the Damned, attracted 3.1 million viewers on Jan. 25.

“We are confident that we have the right content strategy in place with a terrific complement of exclusive originals and quality first-run theatricals that will differentiate us among premium content providers and provide value to our distributors, subscribers and shareholders in the years to come,” Albrecht said in a statement.


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