2:01 p.m. | Updated Once a Netflix skeptic, Time Warner has struck its biggest deal yet to allow the online service to license its television content.
On Thursday, the Warner Brothers Television Group of Time Warner and the CBS Corporation announced a $1 billion deal that will give Netflix the rights to stream shows broadcast on the CW network for at least the next eight years.
Eight dramas currently shown on the youth-oriented CW network, a joint venture between CBS and Warner Bros, will be available for streaming beginning as early as Oct. 15. They include “The Vampire Diaries” and “Gossip Girl.”
The deal results from a yearlong evolution at Time Warner in which the chief executive, Jeffrey L. Bewkes, established a set of guidelines for monetizing content via subscription streaming services like Netflix, Hulu Plus and Amazon Prime.
“Our rules included bypassing the quick and easy money,” Mr. Bewkes said in an interview on Thursday. “We established a strategy to responsibly work with Netflix.”
That strategy included not separating the rights to TV shows so that the same show could be sold into syndication on a traditional TV network and, then, at a diminished rate, to an online subscription service.
Mr. Bewkes came under criticism last year when he argued that Netflix’s potential was overhyped. He compared the Web service to “the Albanian Army” taking over the world.
The Warner Brothers-CBS deal speaks to a continuing evolution, Mr. Bewkes said, adding that the way media companies were cheaply licensing content to online video-on-demand services did not make sense.
He said he envisioned Netflix and other services as a means to make money on shows like those on the CW, which are heavily serialized and would not lead to multimillion-dollar traditional syndication deals like those for CBS’s “Big Bang Theory” or “Mentalist,” both produced by Warner Brothers.
At any point while the Netflix deal is in effect, Warner Brothers and CBS will have the opportunity to shop CW shows around for traditional syndication deals.
The CW’s audience of viewers ages 18 to 34 prompted the companies to explore an online on-demand deal, since younger viewers often prefer to watch TV on laptops or iPads or via streaming. The concept fits what Mr. Bewkes has dubbed “TV Everywhere,” an industrywide push to make money off content while making it available on any device.
In a statement, Leslie Moonves, chief executive at the CBS Corporation, said the deal opened a new revenue stream for CW shows. “It also further illustrates how new distribution systems are providing premium content suppliers with additive revenue streams while still preserving traditional monetization windows.”
But don’t expect CBS or Warner Brothers to make its hit big-tent sitcoms or dramas readily available online. Syndication deals for network shows represent a huge revenue stream for Warner Brothers and bring in big dollars to networks. Last year, Warner Brothers sold “The Big Bang Theory” for a record $2 million per episode to Time Warner’s TBS and Fox.
“We’re talking billions of dollars, so to go and put those shows out essentially on a table in the street is not a good idea,” Mr. Bewkes said.
Between an unpopular price increase, the removal of some popular films and a botched plan to separate the DVD-by-mail arm of its business, Netflix has had an exceptionally hard few months. The price increase, which affected about half of its subscribers, was intended in part to raise more money for content licenses like the one announced on Thursday, a company spokesman said.
“We’re always negotiating with networks and studios,” said the spokesman, Steve Swasey.
He rebuffed a suggestion that the deal with the CW was quickly completed to counter some of the recent bad news headlines. “These deals take a long time to consummate,” he said.
At midday Thursday, Netflix stock had risen about 2.2 percent, to $116.11.
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