NetFlix

SPOTLIGHT: Blu-ray wins two key retailers

Tom Burton — Tue, 12 Feb 2008 06:59:00 -0500

DVD distributor Netflix and Best Buy, the big U.S. electronics retailer, have thrown their support behind Sony's Blu-ray high definition DVD format. The support of the two major retailers for Blu-ray effectively means the end of the format war with Toshiba's HD DVD. It follows a decision by Warner Bros to switch to Blu-ray. Netflix will wind down its HD DVD stock and Best Buy said they would now actively promote Blue-ray. The No. 1 CE retailer Wal-mart has not announced its position on the two technologies. Many analysts believe there will be a sharp uptake of next generation DVD players once the format issue is settled. Netflix is also teaming with LG to build a video on demand set top box. Report

Rentals to power 2.4 billion video downloads

Tom Burton — Tue, 29 Jan 2008 06:59:40 -0500

Fresh from Apple deciding rental is the way to go for their TV service, research group ABI has also concluded this is what will drive the video on demand (VOD) market, claiming half of what is expected to be 2.4 billion download in 2012 will be offered as rentals. There will be an estimated 215 million downloads this year.

ABI says a barrier to industry growth are the restrictive usage policies the studios are requiring of distributors, like having to use the download within 24 hours. ABI research director Michael Wolf predicted studios eventually will offer greater flexibility, in particular as DVD and other physical media continue to mature and new consumer Internet-to-TV hardware expands their audience of consumers.

In a separate report, ABI argues vertically integrated solutions, such as Apple TV, Netflix and TiVO, will drive the market, rather than general providers who utilize public and home networks to deliver their service. Tell that to You Tube, but the point ABI makes is, that for consumers, it is services that offer an end-to-end solution that will be attractive to users.

For More:
- Video download business snowballing Article
- Vertical Integration Is the Key to Successful Internet-TV Convergence Release

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Apple seeks control of video home Report
Netflix and LG go for VOD Report

Apple seeks control of video home

Tom Burton — Tue, 22 Jan 2008 06:59:50 -0500

Apple chief Steve Jobs candidly admits the digital home market was not easy: "All of us have tried: Apple, Microsoft, Amazon, TiVo, Vudu, Netflix, Blockbuster. We've all missed. No one's succeeded yet."

Job's admission came as Apple shifted strategy, offering 1,000 videos for rent--100 in HD--through its iTunes ecommerce portal and Apple TV set top box. Jobs admitted the download for sale approach had not lived up to expectations. Apple has sold about 7 million videos and while that is more than all other download services combined, Jobs said it's below expectations.

The video rentals will cost $4.99 for new release in HD, and will have a 30 day shelf-life and once started will expire within 24 hours of usage. But the show stopper in my mind is still the relatively high cost of the Apple TV box which sells for $229 and requires an Ethernet or high speed wireless connection. Will consumers pay out such a large one off amount when around the corner Comcast is about to offer a box offering 6,000 videos--half in HD--as part of a cable subscription?

The home is the last big battleground and consumers face offerings from all the major players --Microsoft with its Internet enabled Xbox 360, Sony with similarly enabled PlayStation (plus Blu-Ray), LG which is partnering with rental house Netflix, not to mention a gaggle of set-top box developers--with internet adapter boxes as low as $100. All are jockeying for control of what many believe will be the key gateway to the home as residences and businesses move to an all IP platform. For the network providers--telco's and cable MSO's--their full-service business model assumes control of the home digital hub.

Jobs, till now, played down Apples TV strategy, famously calling Apple TV a "hobby." Now, he's hoping Apple's brand strength as a simple to use, easily integrated system, will finally win consumers over and give it leadership in a market expected to be 160 million big over the next five years.

For more:
- Apple launches new video rental service Article
- Analysts give mixed reviews Article

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ALSO NOTED: Netflix drops video limits; Zhone wins Chilean deal;

Tue, 15 Jan 2008 06:58:20 -0500

> Netflix expands Internet viewing option. Article

> Zhone helps Chilean telecom expand IPTV. Article

Netflix and LG go for video on demand

Tue, 08 Jan 2008 06:59:30 -0500

The fight for the TV consumer is being played out at several levels with video in the post provider Netflix abandoning its own set-top box ambitions and announcing it would go with a box to be built by Korean CE giant, LG Electronics.

The box will enable Netflix to migrate its 7 million DVD subscribers to a networked HD streaming service beginning mid this year. No pricing was released ad the move follows Netflix tentative step into the internet download game with its Watch now service that streams a limited number of movies to customer PCs.

The move suggests the DVD business has definitely seen its best days as video on demand services inevitably take over from physical media, although the history of pure play video on demand businesses has not been brilliant to date. Retail giant Wal-mart lasted less than a year with its download service, closing it in the run up to the holiday season. Another start up, Akimbo also decided the market was not ready when it abandoned its proprietary box last year and the Cisco/Intel backed MovieBeam also quietly withdrew from the market last month with less than 1,800 subscribers.

For More:
- LG Electronics and Netflix to stream movies to the TV Release
- Netflix and LG partner for streaming HDTV content Article

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