"We are bullish on this deal as it firmly supports innovation in a critical aspect of our business, while at the same time it leverages our collective strengths and assets to maximize profits in the present market. Flixster provides access to the leading movie discovery application that will promote digital content ownership and aid in expanding our digital business. At the same time, on the physical side, this agreement enables us to manage our profitability in a time of change in the marketplace and to focus more resources on new releases. With its strong infrastructure and track record, Warner will not only safeguard but enhance the long-term value of titles covered by this agreement."
Warner Home Video president Ron Sanders had this to say about the new arrangement.
"These Paramount catalog titles are the perfect complement to the Warner Bros. library; they will allow us to offer consumers new multi-feature film packages and debut many titles on Blu-ray for the first time. The deal also adds a new energy to our Warner Archive Collection initiative, broadening the selection of rare titles available to consumers on demand."
Warner Bros. Digital Distribution president Thomas Gewecke also chimed in regarding the joint venture.
"We're delighted that movie fans will now be able to access Paramount titles through Flixster, further expanding the already robust library of UltraViolet-enabled content and making the continued transition to digital much smoother for the consumer."
The agreement also grants Warner Bros. manufacturing on demand rights and the right to include UltraViolet Digital Copy bundled with packaged media. Paramount will retain all digital rights for their titles, including electronic sell-through (EST), video-on-demand (VOD) and subscription video-on-demand. Flixster will offer, on a non-exclusive basis, Paramount titles for sale in UltraViolet EST format, UltraViolet Disc-to-Digital and VOD. Flixster will also act as an UltraViolet Locker Access Service Provider for all Paramount UltraViolet titles, and as a redemption site for Paramount UltraViolet Digital Copies.
The three-year deal, which takes effect January 1, 2013, covers U.S. and Canadian rights only and includes titles such as Terms of Endearment, Ferris Bueller's Day Off and Airplane!. The agreement excludes approximately 100 cornerstone Paramount titles, including the Transformers, Star Trek and Indiana Jones franchises. Under the same terms, Warner will gain access to select new titles after the initial 26-week release period.
Paramount will receive licensing fees from Warner Bros. and be entitled to various benefits under a long-term strategic cooperation agreement with Flixster.