Netflix has struck a deal with Twentieth Century Fox Television Distribution for streaming rights to reruns of "New Girl," the Fox network's sitcom starring Zooey Deschanel.
While neither Netflix nor Twentieth would disclose terms of the agreement, a person familiar with the matter said the price for "New Girl" is in the high six-figures per episode.
However, there are also mechanisms in place that could ultimately lower the fee Netflix will pay depending on how "New Girl" is exploited on other other platforms including video on demand, two people with knowledge of the arrangement said.
The complexities of the pact reflect a rapidly changing media landscape. With TV shows appearing on so many platforms, structuring syndication agreements has become trickier.
In the case of Netflix, it does not want more than a handful of recent episodes of "New Girl" — five, usually — available on video on demand, Hulu or Fox's website at any given time. Netflix will start carrying the first season "New Girl" on Monday (July 1), and those episodes will not be available elsewhere. Netflix will then add the second season of "New Girl" after the third season debuts this fall.
This issue of how shows are spread across various windows such as Hulu, video on demand, TV Everywhere and streaming services is starting to create tension among traditional pay-TV distributors and content suppliers. Cable and and satellite operators worry that the more content Netflix gobbles up and holds exclusively, the easier it becomes for consumers to cut the cord to their pay-TV subscription.
Consumers meanwhile will often be challenged to hunt down episodes of their favorite shows across multiple platforms rather than finding them all in one place.
That Twentieth sold reruns of "New Girl" to Netflix first before cutting a deal with a cable network and broadcast stations is unusual. Typically, there is more money in a sale of a sitcom to a cable network than to a streaming service such as Netflix or Amazon. For example, USA paid over $1.5 million per episode for reruns of "Modern Family." TBS paid between $1.5 million and $1.7 million per episode for repeats of "Two Broke Girls."
But while "New Girl" has a loyal audience and some critical acclaim, it is unlikely to score as lucrative a deal as "Modern Family" or "Two Broke Girls," which both have bigger audiences. That made Twentieth more willing to sell to Netflix first even it could add hurdles to a sale to a cable network down the road.
"New Girl" got off to a strong start in its first season, but recapturing that momentum has proved difficult in large part because in the fall the show is often preempted for postseason baseball.
Fox said it is planning to air a special episode of "New Girl" after its coverage of the Super Bowl next February, and starting in 2014 it will carry less postseason baseball, as games will migrate to its new cable-sports channel Fox Sports 1.
Follow Joe Flint on Twitter @JBFlint.