Netflix Meets the Family

As its CFO heads out, new streaming content heads in at Netflix (Nasdaq: NFLX  ) .

The video-streaming and DVD-lending giant is inking an expanded deal with Disney (NYSE: DIS  ) . Netflix's digital library is already offering some of the shows that have aired on Disney's ABC and its namesake Disney Channel. The new agreement offers up even more shows and movies, as well as tacking on some of ABC Family's content.

Netflix obviously can't afford to slow down at this point. It is set to roll out its first rate hike in six years for its unlimited movie plans. It will need to make sure that its online catalog continues to expand with titles worth watching.

The value of premium streaming of television shows remains to be seen. Web-savvy couch potatoes already know that they can stream some of ABC's shows through ABC.com and Hulu. Disney owns a chunk of Hulu, along with media partners News Corp. (NYSE: NWS  ) , and General Electric's (NYSE: GE  ) NBC Universal.

Further complicating matters, Netflix won't be streaming relevant Disney programming until at least 15 days after the episodes originally air. Less-patient watchers can typically access ABC content through ABC.com a day after the episode airs in a free ad-supported format.

Then again, this is also the same kind of waiting period for Netflix content that will appeal to local affiliates who are already flummoxed over viewers bypassing the original airing.

Netflix and Coinstar's (Nasdaq: CSTR  ) Redbox have already struck deals with movie studios to hold off on making new releases available during their first 28 days on the market. Waiting two weeks to access fresh streams may seem tame by comparison, especially in the cases where the content isn't being made digitally available.

Terms of the deal aren't being made public, though Netflix is likely to be paying more as it renews -- and expands -- earlier licensing arrangements. The stakes have been raised considerably since it signed its deal with Liberty Starz's (Nasdaq: LSTZA  ) Starz more than two years ago.

The deals, audiences, and implications are larger now. As Netflix hopes to build on its lead over potential competitors, it probably wouldn't have it any other way.

Can Netflix continue to grow its lead in the digital race? Share your thoughts in the comment box at the bottom of this queue.

Walt Disney is a Motley Fool Inside Value selection. Walt Disney and Netflix are Motley Fool Stock Advisor recommendations. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Longtime Fool contributor Rick Munarriz has been a Netflix subscriber -- and shareholder -- since 2002. He also owns shares in Disney. He is part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


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