Netflix shares fall 7 percent at midday after Amazon pens down a deal with Epix

Netflix is sinking in day after day as its prime rival Amazon.com nips on its heels with a deal after deal. The shares of the on-demand video streamer were down 7 percent after Amazon inked a deal with Viacom’s cable network Epix.

The news came at midday that Amazon has joined hands with Epix on a multi-year deal to provide video content on its Amazon Prime Instant Video service. Amazon has been the previous partner with Epix on the same services but the deal matured this month.

Netflix has been paying $200 Million a year to Epix for the exclusive rights to the airing of its wide pool of movies. Epix is a branch of Viacom that also owns Paramount Pictures, Lions Gate Entertainment and Metro-Goldwyn-Mayer Pictures. Epix, therefore, has the right to stream any of the movies distributed or produces by these companies.

Amazon closed the deal for the same set of services on its Amazon Prime membership and Netflix is left in the rear-view mirror. Analysts are of the opinion that Netflix will lose a huge chunk of its subscribers due to the loss of a large video library.

Late last week, Amazon struck a deal with National Broadcasting Channel, NBC for the online streaming of its archival and latest videos in addition to live streaming. That was another blow to Netflix, who has already been aching in the online streaming services.

The major opportunity fell into Netflix lap when the likes of Apple and Roku launched their respective online streaming set-top boxes. Netflix is also available on Samsung and other television sets.

Analysts say that the deal will help Amazon create a company-friendly aura around the release of it’s Kindle tablet. The company is slated for a press conference in Santa Monica this Thursday, September 6, where they are expected to unveil the next generation Kindle tablet.

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Posted by Usman Khalid on Sep 5 2012. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.