Netflix addressed the concerns of confused customers today announcing that all Sony content acquired through the Starz Play deal was no longer available. Among the pulled movies are The Social network, Salt, and The other Guys. Netflix called the situation a “temporary contract issue”, but it might be a sticky issue for Starz.
According to GigaOm, the problem is a clause in the contract Starz has with Sony. Starz has passed its IP distribution cap for Sony content and has asked Netflix to remove those films. The contract Starz agreed to with Sony didn’t have any built in escape hatches in the even Netflix growth took off, which it did.
Netflix has nearly 70% more subscribers than they did a year ago, an increase of 14 million to 22.8 million. Netflix isn’t offering any additional information about the removal of Sony films, and it’s not really in their hands. Sony and Starz will have to work out a deal, if one is even plausible. We can’t see Starz putting up more cash just to benefit Netflix.