Netflix Gains Rights to Disney ‘Star Wars’ Cartoon Series

Netflix Inc. (NFLX), adding to its growing role in kids’ online videos, obtained exclusive streaming rights to an animated TV series based on George Lucas’s “Star Wars” movies from Walt Disney Co., including the new final season.

U.S. and Canadian subscribers will be able to view the 13-episode sixth season of “Star Wars: the Clone Wars” beginning March 7, Los Gatos, California-based Netflix said today in a statement. The series ran for five seasons on Time Warner Inc.’s Cartoon Network, according to the Star Wars website.

“‘Star Wars’ is one of the most iconic franchises of all time, and this series joins a long line of Disney content that Netflix members are and will continue to enjoy for years to come,” Ted Sarandos, the streaming-video company’s chief content officer, said in the statement. “The ‘Clone Wars’ marks an important moment as Netflix welcomes more and more first-run content from the Walt Disney Co. and its subsidiaries.”

Netflix is focusing on delivering a mix of exclusive TV shows and movies, including children’s fare, as it battles Amazon.com Inc., the largest online retailer, and Hulu LLC for online viewers. The company has exclusive deals with both Disney and DreamWorks Animation SKG Inc.

Obi-Wan Kenobi in "Star Wars: The Clone Wars." Illustration: Warner Bros./Everett Collection Close

Obi-Wan Kenobi in "Star Wars: The Clone Wars." Illustration: Warner Bros./Everett Collection

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Obi-Wan Kenobi in "Star Wars: The Clone Wars." Illustration: Warner Bros./Everett Collection

Netflix rose 1.7 percent to $436.38 at 11:05 a.m. in New York after reaching a record $439.35 intraday. The shares have more than doubled in the past year. Disney, based in Burbank, California, gained 0.3 percent to a record $78.11. It has risen 42 percent in the past 12 months.

Streaming Accord

Starting in 2016, Netflix gains exclusive U.S. streaming rights to movies from Disney, the world’s largest entertainment company, in a release schedule typically reserved for premium cable channels like Liberty Media Corp.’s Starz.

Netflix negotiated separately with Disney for “Star Wars: The Clone Wars,” said Jenny McCabe, a spokeswoman for Netflix.

The world’s largest subscription streaming service also will offer expanded versions of the first five seasons of the Emmy award-winning show.

Last year, Netflix passed Time Warner Inc.’s premium cable outlet HBO in paid U.S. subscribers. The second season of the Kevin Spacey political thriller “House of Cards” becomes available for streaming tomorrow on Netflix.

Michael Pachter, an analyst at Wedbush Securities in Los Angeles, has questioned whether Netflix can grow fast enough to pay for about $7.3 billion in programming obligations over the next five years.

Chief Executive Officer Reed Hastings said in February that Netflix is considering changing its unlimited $7.99 monthly pricing plan, replacing a single fee with three tiers that would increase revenue and profit.

The “Star Wars” TV series, set between the events of the second and third episodes of the movies, “Attack of the Clones” and “Revenge of the Sith,” follows the adventures of Obi-Wan Kenobe, Anakin Skywalker and Ahsoka Tano, a young Jedi.

Lucasfilm Ltd., acquired by Disney for $4 billion in December 2012, announced in March of last year that production of new TV episodes had stopped.

Of the children’s programming available to the service, about 30 shows typically attract more than 2 million viewers, Sarandos said in a recent interview, without elaborating.

To contact the reporter on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net

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