You can't get enough of a good thing. Or, can you?
Netflix (NASDAQ: NFLX) will offer a new box built by LG Electronics, to allow movies to be downloaded over the internet [subscription required] and played on a TV. It sounds a lot like products from Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN) and several other companies. The new project will also have to compete with cable VOD and DVR functions.
Netflix has a problem, but it may not be one that it can fix. According to The Wall Street Journal "Netflix has about 6,000 movies and television shows available for streaming over the Internet, a small fraction of the more than 90,000 DVDs in its library." Since the internet-based content is probably made up of the most popular shows, the limited selection may not be a problem.
The big hurdle is that video content delivery over the internet has become such a crowded industry that it is difficult to imagine how one company will stand out. Cable VOD is so easy to use that there does not seem to be a compelling reason to turn to an alternative.
It is also not clear if consumers would want yet another box in their homes. Many TVs have a DVD player, a DVR, a cable box and a PC link to the television. The pile is so high that the Netflix box may cause it to fall over.
Douglas A. McIntyre is an editor at 247wallst.com.