It’s a blow to Rhimes’ longtime distributors at ABC, whose parent company Disney announced earlier this week that they’d be pulling their titles from Netflix’s streaming service.
The multi-year production deal with Netflix will see Rhimes’ Shondaland production company produce new series “and other projects” for the video streaming and dvd rental service.
The deal doesn’t affect Grey’s Anatomy, Scandal and How to Get Away with Murder, which will continue to air in the U.S. on ABC.
“Shonda Rhimes is one of the greatest storytellers in the history of television,” said Ted Sarandos, Chief Content Officer, Netflix, in a statement. “Her work is gripping, inventive, pulse-pounding, heart-stopping, taboo-breaking television at its best. I’ve gotten the chance to know Shonda and she’s a true Netflixer at heart — she loves TV and films, she cares passionately about her work, and she delivers for her audience. We’re so excited to welcome her to Netflix.”
Betsy Beers, Rhimes’ longtime partner, who has helped ABC make over $2 billion from the licensing and sales of Shondaland shows, will make the move to Netflix as well.
For her part, Rhimes said that the deal is the result of a “shared plan” between herself and Netflix’s Sarandos. “Ted provides a clear, fearless space for creators at Netflix. He understood what I was looking for — the opportunity to build a vibrant new storytelling home for writers with the unique creative freedom and instantaneous reach provided by Netflix’s singular sense of innovation.”
While thanking ABC Studios president Patrick Moran and Channing Dungey, president of ABC Entertainment Group, the move to Netflix is the latest in a series of high profile acquisitions that have shaken up the entertainment landscape and a blow to ABC’s parent company.
Within the past week Netflix has managed to coax talk show legend David Letterman out of retirement, snatch up the (somewhat middling) comic publishing house Millarworld for new exclusive programming, and snagged Academy Award winning writer-directors Joel and Ethan Coen for a new Western series.
It’s the latest sign that the war for talent in Hollywood is well and truly on. Netflix has already spent around $6 billion this year on its original programming, and secured a $500 million line of credit earlier this year to buy even more. Meanwhile Amazon is throwing piles of its own (not-insignificant) cash hoard at original programming as well.
The house that Bezos built has spent about $4.5 billion on new, original programming this year, which is hardly chump change.
Meanwhile ABC’s parent company, Disney, has been spending billions of its own to roll out a new streaming service in 2019.
Last year Disney bought a minority stake in BAMTech for roughly $1 billion (with an option to acquire the entire company). It’s the BAMTech service that will provide the foundation for Disney’s new streaming offering.
And the company is already pushing an on-demand subscription video service for Disney movies in the UK (and briefly in China) called DisneyLife.
As TechCrunch’s Sarah Perez previously reported:
DisneyLife was seen as a way for Disney to experiment with streaming, before a larger public launch.
This not only includes being able to test out the underlying infrastructure for such an endeavour, but also what sort of content users respond to, what features they want, how parental controls should work, and so on. On DisneyLife, consumers pay a small monthly fee that lets families of up to six stream Disney movies, TV shows, even music, audiobooks and e-books online, on mobile devices, and to TVs through AirPlay and Chromecast.
If anything, DisneyLife is very much like a Disney-flavored Netflix, and could be looked to as an example of what’s to come.
Terms of the deal with Netflix weren’t disclosed, but the Wall Street Journal reported that Rhimes’ ABC production deal is worth more than $10 million per year to produce shows — and she has profit participation which means a percentage cut of all international deals and reruns.