I’m putting on my fantasy hat. Imagine: All of the Netflix movies, television shows, and other content streamed into my living room whenever I want. No more waiting for the post office to deliver the next disk. No more red envelopes to deal with.
Netflix, the DVD-by-mail company with more than seven million subscribers, is partnering with Korean manufacturer LG Electronics to stream movies, TV shows, and other content to LG high-definition televisions or set-top boxes by the second half of 2008.
Reed Hastings, Netflix CEO, said he hopes to strike similar deals with other device manufacturers, potentially creating the Netflix movie channel and seriously challenging other companies attempting to capture the digital-entertainment-in-the-living-room opportunity.
“We want to be integrated on every Internet-connected device, game system, high-definition DVD player and dedicated Internet set-top box,” Hastings said. “Eventually, as TVs have wireless connectivity built into them, we’ll integrate right into the television.”
Details of the Netflix-LG partnership and Netflix’s overall plans are sparse — we’ll likely learn more at next week’s Consumer Electronics Show in Las Vegas. But this much we know, or think we know.
A year ago, Netflix announced it was allowing paying subscribers to watch 6,000 movies and television shows via its Web site (Windows only) for free. These movies are likely to be available for streaming to an LG television or set-top box for no additional cost to subscribers (other than the purchase price of the TV or box).
With the Netflix platform in place, it’s safe to assume that additional titles will be made available over the next few years from Netflix’s library of more than 90,000 films and TV shows. Wouldn’t it be great to “rent” season one, disk one of “Lost”, finish the first four episodes, then with the click of a button order disk two without waiting for the postman?
How much a Netflix-enabled TV or set-top box will cost, what it will look like, and what features and functions it will have are unknown. How long do I get to watch a movie? Can I save it or move it to another device? Early speculation is that the Netflix service could be added to a future release of LG’s dual HD DVD and Blu-ray DVD player, which currently sells for $799.
The potential of Netflix delivered directly to your TV is enormous and puts pressure on all companies introducing products or services in the space. No matter how popular watching movies and TV shows on computers is becoming, the majority of people still want to watch these on a television in the living room.
Vudu, which offers a set-top box for $399, lets consumers buy or rent movies from a sporadic selection of about 5,000 titles (see our review). Apple released AppleTV nearly a year ago, then has largely ignored it. Apple is expected to announce at Macworld a video rental service for iTunes, but the only known studio participants are Fox and Disney, hardly the catalog Netflix could offer. Cable companies, telcos, and anybody else selling video-on-demand services should also be concerned. Why spend $4 to rent a movie when you already subscribe to a Netflix plan, which will offer viewers many more choices.
Consumers can also download movies from Amazon’s Unbox to watch on TiVo set-top boxes, but Unbox is limited to only TiVo. Wal-Mart just gave up on its online video venture. Many more services are struggling.
“Internet to the TV is a huge opportunity,” Hastings said. “We believe streaming is the way to go.”
Richard Doherty, research director of the marketing research firm Envisioneering Group, told The New York Times, “You’re already a subscriber and you don’t pay anything extra. That’s called a slam dunk in most businesses we follow.”
Imagine: Netflix just a click away.