Netflix announces MGM movie deal

US home entertainment company Netflix has signed a deal with movie giant MGM to stream films through its subscription service when it expands into the Irish and British markets next year.

The Metro-Goldwyn-Mayer Studios deal will make Netflix the exclusive subscription streaming service in the UK and Ireland for most first-run feature films from MGM within a year of their cinema release.

“We are delighted to be entering the UK and Ireland with a legendary studio like MGM at our side,” said Netflix chief content officer Ted Sarandos. “And we are excited to be extending our relationship with MGM from the US to these important markets and proud to be the exclusive home for their films in the traditional pay TV window.”

Netflix, which announced its intention to enter the Irish market last month, is a subscription-based rental service which allows users access movies and television shows for a monthly fee over the internet.

“Developing this relationship further will help us bring our films, both old and new, into the homes of our loyal audiences with the great ease Netflix offers customers,” said MGM's Roma Khanna.

Netflix has promised the highly-anticipated prequels to the Academy Award-winning Lord of the Rings  trilogy by Peter Jackson will be available within a year of their theatrical release. A selection of MGM catalogue titles will also be available to subscribers.

The Californian company, which started out as a DVD rental company, has increasingly been moving to online streaming, but recently attracted criticism after it increased its subscription charges and restructured its business model.

In July, it increased subscription charges by up to 60 per cent, a move which resulted in its share price dropping by 60 per cent. In September, it said it would move its DVD rental business to a new website called Qwikster but within a month reversed the decision.

Chief executive Reed Hastings admitted the company had communicated the changes badly but said it would still have 25 million members in the US, Canada and Latin America. It charges users $7.99 a month for unlimited access.

The company said it would release details about its pricing structure in Ireland closer to the launch early next year.