Major Hollywood films like "Hunger Games: Catching Fire" and "World War Z" will be shifting from Netflix to Hulu in coming weeks, as pay-TV channel Epix switches up its streaming partners.

The moves reflect a broader trend in the streaming-video business as Netflix Inc. continues to become pickier about paying for rights to TV shows and movies that can be found elsewhere. At the same time, a newly aggressive—yet, for content owners, more accommodating—Hulu is ramping up its content spending to challenge Netflix's dominance.

Netflix said Sunday that it had allowed its deal with Epix to lapse at the end of September because the streaming-video company is trying to move away from nonexclusive content toward its own original programming and exclusive rights to movies.

Epix is owned by MGM, Lions Gate Entertainment Corp. and Viacom Inc.'s Paramount studios and has the rights to high-profile films like "Transformers: Age of Extinction." In addition to its deal with Netflix, Epix signed a deal with Amazon Prime Instant Video in 2012 and announced Sunday that it has just signed a deal with Hulu starting in October.

"While many of these movies are popular, they are also widely available on cable and other subscription platforms at the same time as they are on Netflix," wrote Netflix Chief Content Officer Ted Sarandos in a blog post Sunday. "Through our original films and some innovative licensing arrangements with the movie studios, we are aiming to build a better movie experience for you."

Mr. Sarandos said Netflix has been trying to develop its own slate of original movies with stars like Brad Pitt, Ricky Gervais and Judd Apatow, but acknowledged that "it will take us time."

In the meantime, Netflix announced an array of originals, including "Ridiculous Six," the first of four comedies from Adam Sandler, and "A Very Murray Christmas," in which Sofia Coppola directs Bill Murray, both coming in December.

This shift toward originals mirrors what Netflix did in television with "House of Cards" and "Orange is the New Black," investing more in its own series even as it got pickier on its licensing deals for reruns.

This pickiness has created an opening for the much smaller Hulu, which is owned jointly by 21st Century Fox, Comcast Corp.'s NBCUniversal and Walt Disney Co.

This year, Hulu is expected to double its spending on content to $1.5 billion according to RBC Capital Markets analyst David Bank.

(21st Century Fox and News Corp, owner of The Wall Street Journal, until mid-2013 were part of the same company.)

For Epix, which has 14 million subscribers—less than half the count of category-leading HBO—the strategy has been to try to distribute its content to as many players as possible as the subscription streaming-video industry expands, according to people familiar with the matter.

The tech blog Re/Code earlier reported that Epix was likely to replace its Netflix deal with Hulu.

 

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(END) Dow Jones Newswires

August 30, 2015 20:35 ET (00:35 GMT)

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