Netflix (NASDAQ: NFLX) has set up a deal with Tivo (NASDAQ: TIVO) to download rental movies to the digital video recording company's set-top boxes. The marriage represents another product in a massively crowded part of the premium video business.
According to The Wall Street Journal, "The deal unites two high-profile tech brands that are both attempting to navigate the transition to a time when most video is delivered over the Internet rather than on DVDs and through television." At this stage, this type of partnership is nearly useless. Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN), and several private companies are in related businesses. Cable companies already offer on-demand products as do the new fiber-to-the-home telephone company services.
The critical question is how any of these companies believe that they can do well against cable TV on demand services. Although cable may not offer thousand of titles that no one will watch, they do have the most popular movies which probably make up over 90% of the content consumers want to watch. And, the cable companies already have the hardware and billing system to make the service seamless for customers.
Netflix is a little late. The product is not likely to get many takers.
Douglas A. McIntyre is an editor at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
10-30-2008 @ 7:40AM
Virgil Bierschwale said...
Contrary to what you may believe, cable on demand is only available in the cities and there are probably 100 million of us that do not live in the cities.
Netflix and Tivo both are a godsend out here.
Virgil
http://www.KeepAmericaAtWork.com
10-30-2008 @ 8:37AM
Rusty said...
There is a market for movies other than the most recent blockbuster drivel. This is what drives the Netflix model: choice, choice and choice. I have been an avid Netflix user for many years, and will continue to do so. The coax will reattach to my house only when I am gone. Also satellite will have to deliver on demand over the internet, as it already does. A Netflix, TIVO, DirecTV partnership would go far against cable.
10-30-2008 @ 9:49AM
DDL said...
What's also not been made clear is that the streaming Netflix programs will be available free of charge (as long as you are a current subscriber). All of the VOD stuff from the cable companies is pay-per-use. Netflix + Xbox, and Netflix + Tivo, are going to be the first real way of getting free HD streaming to the masses, and the first nail in the coffin of Blu Ray.
10-30-2008 @ 9:41AM
Davis Freeberg said...
Lets see you can pay cable $50 a month for HDTV and a lousy PVR or you can get a $9 a month Netflix subscription and an $8 a month TiVo subscription and have access to almost all of the same content using a high def over the air attenna. Maybe you won't get ESPN or Comedy central, but through Netflix you can get HBO content and a most of the cable programming not to mention the over 100,000 DVDs. If you save $30 a month this works out to be about $360 per year. Maybe that's not exciting to you, but I'm looking forward to this partnership.
11-03-2008 @ 10:40AM
Marius said...
You are clueless. Netflix is aggressively growing his subscription base. I started using something called PlayOn for PS3 that gives me access to Netflix and Hulu. OnDemand content can be potentially a game changer and it turns Tivo as wells as gaming systems such as Xbox 360 and PS3 in multimedia monsters,.