Netflix To Set Deal With Cable Companies?--Reuters

Cable companies and Netflix (NASDAQ: NFLX) have been natural enemies for years. First, its DVD by mail service undercut cable firm VOD to  the home. Then, Netflix streaming video over broadband internet posed another challenge to what cable companies could make from premium channels and VOD.

But, Netflix has been on the ropes lately as an increase in fees caused a revolt among subscribers, and the cost of premium content from studios has gone up. Netflix has even begun to create its own programs.

But the ice between cable and Netflix may have thawed as companies like Time Warner Cable (NYSE: TWC) and Comcast (NASDAQ: CMCSA) have tried to battle premium channels for what the collect as carriers of content. Netflix could be an ideal partner to improve their negotiating position with studios.

An exclusive report from Reuters said

In what would ratchet up its competition with HBO, the talks could lead to Netflix becoming available as another on-demand option for cable subscribers through their set-top boxes, according to three people familiar with the talks. If a partnership came to fruition, a cable operator might offer Netflix as an additional option added onto a subscriber’s cable bill