Can Netflix Afford to Lose Disney?

Just a few months after Walt Disney's (NYSE: DIS) exclusive streaming deal with Netflix (NASDAQ: NFLX) began, it's coming to an end. Disney announced its plan to end its relationship with Netflix in 2019 to start its own direct-to-consumer streaming product.

The represents a major blow to Netflix, which has spoken highly of Disney's content library. "Disney makes big franchise films. The movies that people like to watch over and over again," Chief Content Officer Ted Sarandos said last year.

More importantly, it could be the start of a sea change for Netflix's content licensing business, which relies on other media companies. Other media execs, such as Time Warner's (NYSE: TWX) Jeff Bewkes, have expressed their concern that licensing shows and movies to Netflix is negatively affecting the results of their television ratings and movie sales. Some may decide to follow in Disney's footsteps, destroying some of the value of a Netflix subscription.

Source: Fool.com