Disney’s Iger explains why Netflix was chosen as pay-TV movie partner

Walt Disney Co. CEO Bob Iger explained to analysts Tuesday why the company chose Netflix Inc. to be its pay-TV partner for first-run theatrical films starting in 2016, a move that shocked the entertainment industry. Normally, a premium cable channel is chosen to carry such movies; Disney’s current deal is with Starz.

“We were impressed with the platform and user interface,” Iger said of Netflix. “They stepped up and paid the right price, which was also very important.”

(Terms were not disclosed, but published reports said Netflix could be paying $300 million per year under the deal.)

Iger added that there is sufficient demand for the programming on Disney Channel and other cable outlets that consumers would not be encouraged to disconnect from traditional pay-TV subscriptions. Programs like “Phineas and Ferb,” “Jessie,” “Shake It Up” and Disney Junior series “Doc McStuffins” remain big draws for children and tweens.

“This is a movie play … The demand to see the TV shows on Disney Channel and Disney Junior is very high, and people still have to subscribe to multichannel video services to see them,” Iger said.

— David B. Wilkerson