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DreamWorks Signs Multi-Year Deal With Netflix (DWA, NFLX)

DreamWorks Animation Skg Inc. (NASDAQ: DWA) has entered in a multi-year agreement to produce in excess of  300 hours of content for internet-video streaming company Netflix Inc. (NASDAQ: NFLX).

According to the terms of the deal, DreamWorks Animation would create shows that will be based on its previous and forthcoming feature films. In addition, the production house will also use the Classic Media Library, which it bought last year. This will be first time when the Studio introduces its animated characters in the television market.

For Netflix Inc, this multi-year deal is its biggest ever for first-run programs while for DreamWorks the deal marks a major step forward towards expanding its television production and worldwide distribution.

The Glendale, California-based studio was keen to expand its television production in order to reduce its overreliance on animated feature films. Already, DreamWorks creates series and TV specials based on its movies for Nickelodeon and Cartoon Network. Just Last month, the Studio bought the You Tube teen network, Awesomeness TV in an all cash deal valued at $33 million.

Netflix, which has a subscribers’ base of more than 36 million, spread across 40 countries, expects to start airing the new animated series in 2014, worldwide.

Also, Netflix Inc’s U.S. and Latin America based subscribers will  get an access to the studio’s latest productions, which include “Turbo” and “The Croods”.

Furthermore, the deal would also deepen existing relationship between the two companies.

Commenting over the deal, DreamWorks Animation Chief Executive Officer, Jeffrey Katzenberg said in a statement, “This is an unprecedented commitment to original content in the Internet television space… Netflix is a visionary company that continues to redefine the way audiences watch television and it is a thrill to add to their growing momentum.”

Shares of rallied about 6.75% while shares of DreamWorks jumped about 4.15% by mid-day trade.



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