Pretty Little Liars' Netflix Departure Is a Sign of Things to Come

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Every month, Netflix (NASDAQ: NFLX) reveals a list of what’s coming to and departing from its platform the following month. July’s list heralds the arrival of Caddyshack and a new season of Stranger Things, but one departure has stolen most of the spotlight. Pretty Little Liars is leaving the platform, and fans are not happy.” data-reactid=”11″>Every month, Netflix (NASDAQ: NFLX) reveals a list of what’s coming to and departing from its platform the following month. July’s list heralds the arrival of Caddyshack and a new season of Stranger Things, but one departure has stolen most of the spotlight. Pretty Little Liars is leaving the platform, and fans are not happy.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="People get upset whenever shows leave Netflix, of course, but Pretty Little Liars‘ departure is unlikely to be an isolated incident. In fact, it seems that Netflix has a real licensed content problem brewing.” data-reactid=”12″>People get upset whenever shows leave Netflix, of course, but Pretty Little Liars‘ departure is unlikely to be an isolated incident. In fact, it seems that Netflix has a real licensed content problem brewing.

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<h2 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Where is Pretty Little Liars going?” data-reactid=”25″>Where is Pretty Little Liars going?

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Pretty Little Liars won’t be available to stream on Netflix in July, but that doesn’t mean it will disappear from the internet. There’s no word yet on where it might become available to stream, but Hulu is a pretty good guess. Why? Hulu is owned by Disney (NYSE: DIS), which also owns ABC Family, which made Pretty Little Liars in the first place.” data-reactid=”26″>Pretty Little Liars won’t be available to stream on Netflix in July, but that doesn’t mean it will disappear from the internet. There’s no word yet on where it might become available to stream, but Hulu is a pretty good guess. Why? Hulu is owned by Disney (NYSE: DIS), which also owns ABC Family, which made Pretty Little Liars in the first place.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="We've seen this kind of vertical integration in streaming over and over again since the Disney-21st Century Fox merger kicked off a new gold rush&nbsp;for so-called "Netflix killers,"&nbsp;which are companies that also happen to also be major content creators. It simply makes more financial sense for Disney to have its most beloved shows on its own streaming services. (Pretty Little Liars‘ distributor is AT&amp;T-owned&nbsp;Warner Bros. Television Distributing, but streaming deals are usually cut directly by studios.)” data-reactid=”27″>We’ve seen this kind of vertical integration in streaming over and over again since the Disney-21st Century Fox merger kicked off a new gold rush for so-called “Netflix killers,” which are companies that also happen to also be major content creators. It simply makes more financial sense for Disney to have its most beloved shows on its own streaming services. (Pretty Little Liars‘ distributor is AT&T-owned Warner Bros. Television Distributing, but streaming deals are usually cut directly by studios.)

Just as predicted

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="That Netflix was unable to hold onto a big show made by Disney is hardly a surprise. We've been expecting Netflix to lose shows like this for a while now. Long-term deals are keeping the losses from happening all at once (the fact that services like Disney+ aren’t actually available to consumers yet helps, too), but these sorts of losses are inevitable in the long term.” data-reactid=”29″>That Netflix was unable to hold onto a big show made by Disney is hardly a surprise. We’ve been expecting Netflix to lose shows like this for a while now. Long-term deals are keeping the losses from happening all at once (the fact that services like Disney+ aren’t actually available to consumers yet helps, too), but these sorts of losses are inevitable in the long term.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Pretty Little Liars isn’t unique. Presumably, it was just one of the first shows licensed from Netflix’s now-competitors to hit the end of its current contract. We can’t know for sure, since Netflix doesn’t share details of this nature, but we do know the streaming service inked its&nbsp;Pretty Little Liars deal&nbsp;in 2012, which is a long time for any show to run on the platform. There may be some big, dramatic renegotiations in Netflix’s future, but it seems prohibitively likely that most shows will leave quietly like this, when options are not picked up or contracts are not renewed.” data-reactid=”30″>Pretty Little Liars isn’t unique. Presumably, it was just one of the first shows licensed from Netflix’s now-competitors to hit the end of its current contract. We can’t know for sure, since Netflix doesn’t share details of this nature, but we do know the streaming service inked its Pretty Little Liars deal in 2012, which is a long time for any show to run on the platform. There may be some big, dramatic renegotiations in Netflix’s future, but it seems prohibitively likely that most shows will leave quietly like this, when options are not picked up or contracts are not renewed.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="This will cost companies money, of course; Disney reportedly expects to lose $150 million in operating income as it parts from Netflix. But the pros outweigh the cons for mammoth entertainment companies like this,&nbsp;because taking major hits like&nbsp;Star Wars and Marvel Studios films away from a competitor and putting them on Disney+ just in time for its launch seems sure to draw eyeballs to its service — and perhaps away from others.&nbsp;(We don’t know when Disney’s deal with Netflix expires — it was announced only as "a multiyear deal" and started in 2016 — but it has been widely reported that Disney+ will launch with&nbsp;Star Wars and Marvel Studios films, and the service is supposed to arrive in November of 2019.)” data-reactid=”31″>This will cost companies money, of course; Disney reportedly expects to lose $150 million in operating income as it parts from Netflix. But the pros outweigh the cons for mammoth entertainment companies like this, because taking major hits like Star Wars and Marvel Studios films away from a competitor and putting them on Disney+ just in time for its launch seems sure to draw eyeballs to its service — and perhaps away from others. (We don’t know when Disney’s deal with Netflix expires — it was announced only as “a multiyear deal” and started in 2016 — but it has been widely reported that Disney+ will launch with Star Wars and Marvel Studios films, and the service is supposed to arrive in November of 2019.)

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Licensed content isn't the only place where conflicts can take Netflix shows down. As I've written before, even Netflix originals aren’t always safe — some of them, like Jessica Jones and other Netflix Marvel series, were made in collaboration with now-rivals like Disney. There’s plenty of reason to be concerned about original content, but the loss of beloved licensed content will likely be what hurts Netflix the most.” data-reactid=”32″>Licensed content isn’t the only place where conflicts can take Netflix shows down. As I’ve written before, even Netflix originals aren’t always safe — some of them, like Jessica Jones and other Netflix Marvel series, were made in collaboration with now-rivals like Disney. There’s plenty of reason to be concerned about original content, but the loss of beloved licensed content will likely be what hurts Netflix the most.

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