As we all know by now, Starz and Netflix fell out and contract negotiations halted without a deal. Now, we know why as Starz has announced that they are working on their own TV everywhere authenticated product that will stream their content to any connected device.

Their new service, according to the Starz CEO, is set to debut next year and will first manifest itself as a new TV and movie channel for cable and satellite. In addition to that they have stated they are “exploring possibilities of a stand-alone online service for Internet subscribers.”

The move comes after the failure of Netflix to pony up enough cash to keep the media company happy and their content flowing through the subscription service. In regards to that, Chris Albrecht, Starz CEO, had this to say, “Within two to three years, the Netflix deal would have been a drag on our earnings.”

Ouch. It sounds like those final contract negotiations did not go well at all.

The two sides failed to reach an agreement because Starz, the exclusive TV and video first-run distributor of Walt Disney Co and Sony Pictures releases, had wanted to have a premium tier in the Netflix package, similar to what it has on cable television, said the recent press release. So they wanted you to pay more for their stuff than other stuff, how self-centered and egotistical of them.

It seems that, with this new move, Starz is aiming to hit the younger audience who is more interested in not having a pay TV service and who want to access content outside of the home. It also seems that they are going to charge quite a bit for the service if they were already thinking that everyone should pay more just for their stuff.

In stating that they’re looking at a stand alone streaming service it means they are willing to unbundle themselves from traditional cable and satellite operators, unlike HBO which requires you to have a subscription to their cable/satellite channel to get their HBO Go service. Who wants to bet the Starz Online package will be $7.99 a month?