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Netflix (NFLX) brings TV watchers another gadget

Many home TVs now have five or six boxes on top of them: TV cable boxes, DVRs, satellite dish devices and perhaps an Unbox from Amazon (NASDAQ: AMZN). NetFlix (NASDAQ: NFLX) wants to add to that gadget explosion.

NetFlix already has 8.2 million subscribers, so it does have a built-in base that many competitors do not. Its new device will only cost $99 and will give instant access to a large list of titles. According to The News York Times, the new system "will allow customers to play thousands of movies and shows on their televisions instantly, for no charge beyond their normal subscription fee."

While it is impossible to handicap the success of these products, the NetFlix offering may do well. For starters, very few competitors start with huge pools of customers who are already buying products from them. In addition, the box is remarkably cheap. While the selection of titles is not special, the cost of playing them is modest because there is no fee beyond the standard NetFlix subscription fee.

NetFlix still has to deal with the problem that the number of wires into the TV is way too large.

Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.

The Wal-Mart Weekly: Wal-Mart's ill-fated foray into digital content downloads

Welcome to the 43rd installment of The Wal-Mart Weekly, a column dedicated to bringing you insight, wit, facts, results, opinions and just a bit of everything else when it comes down to a very hot topic these days: Wal-Mart.

Last week, I looked at Wal-Mart Stores, Inc. (NYSE: WMT)'s 2007 in review and summed up all the retailing giant had going for it last year along with all the negatives against the company as well. Wal-Mart did a lot of things right in 2007, but still had to fend off daily attacks from its enemies and just about any other entity who took shots at the largest target in the world.

This week, I'll be looking at something that just happened this past week -- when Wal-Mart decided to end its year-old movie download service after middling to no success since its launch in 2006. Why didn't the retailer have any success in the move to offering entertainment content in digital, downloadable form? Read on.


Continue reading The Wal-Mart Weekly: Wal-Mart's ill-fated foray into digital content downloads

Amazon's (AMZN) Unbox video service turning into Apple (AAPL) iTunes competitor?

Is Amazon.com, Inc. (NASDAQ: AMZN)'s Unbox video download service worth a look for those wanting to get into video downloads outside of Apple, Inc. (NASDAQ: AAPL)'s iTunes product offerings? Depending on which products you may already have in your home, it very well may be.

Amazon's Unbox video service has been tweaked since I originally looked at it a few months ago, and now the service offers many free TV show downloads for use with your computer or portable media player (like the new Creative Zen), as well as movie and TV show downloads for your TiVo, Inc. (NASDAQ: TIVO) box.

While Amazon's Unbox video player program download doesn't feature all the niceties of Apple's iTunes, I'm not sure it was designed to. The program download, which facilitates content transfer to your PC, is very straightforward and incredibly easy to use. While not featuring music or podcast downloads, the program focuses on video content exclusively (for now). However, that may change soon, with Amazon recently unveiling that it's now offering 2+ million non copy-protected music downloads as well. Perhaps the Unbox player will feature music content soon? That would be my educated guess.

Continue reading Amazon's (AMZN) Unbox video service turning into Apple (AAPL) iTunes competitor?

Amazon (AMZN) and GE's NBC Universal launching content on demand

Amazon.com (NASDAQ: AMZN) and NBC Universal, a unit of General Electric Co. (NYSE:GE), announced earlier today that much of the TV content from NBC Universal is now available on the new Amazon Unbox digital video download service.

Popular NBC shows now available include the series The Office, Heroes, and the comedy 30 Rock. Starting September 10, Amazon Unbox customers can download free and pre-show advances of network premiers of pilot episodes of NBC's new shows Bionic Woman, Chuck, Journeyman and Life. New episodes will be available on Amazon Unbox the day after they air on TV.

Amazon Unbox is actually almost a year old now from an "official" status. If you look at what has been happening out of Google Inc.'s (NASDAQ:GOOG) YouTube unit, this is just one more step along the route. Amazon and NBC Universal offer viewer a variety of content packages, and it is going to be interesting to see how this and all other PC-video initiatives pan out through time. So far, convergence has been a bust as much of the country (and world) has yet to migrate their TVs, music, movies, and computers.

Jon C. Ogg produces the Special Situation Investing Newsletter for 24/7 Wall St.; he does not own securities in the companies he covers.

Amazon (AMZN) gets an upgrade

Amazon.com Inc. (NASDAQ: AMZN) got an important upgrade today.

Sanford C. Bernstein increased its rating on the stock from "market perform" to "outperform." The firm also raised its price target to $95 from $81. The stock opened up at about $81.

Bernstein assumes that Amazon's margins will rise due to higher third-party sales on the website. Amazon receives a fee for these sales.

The huge online retailer's stock has been as high as $89 this year, and it is up more than 100% year-to-date. Short interest in the shares fell 4.8 million to 35.8 million as some investors anticipated a price increase.

Third-party fees are not the only reason the stock is doing well. But, it is something of a surprise that an analyst believes that it can do even better after its big run.

Continue reading Amazon (AMZN) gets an upgrade

Amazon and TiVo gamble on PC bypass

Amazon Inc. (NASDAQ: AMZN) and TiVo have joined forces in the war to take the top spot in the realm of video content provision. Unfortunately, the team has opted to take a route which cuts personal computers out of the video-viewing loop. That's a sad miscalculation if you ask me.

It is reported that the Amazon-TiVo team will be directly selling movies, episodes of television shows and other video content for a price range of $2 to $4 for download directly to TiVo units with the "Amazon Unbox on TiVo" upgrade and high speed internet connections. This is a service which broke ground in February of this year and which at that time required users to choose their entertainment selections using a personal computer. It is my interpretation that the current move by this entertainment alliance, in making their venture "TiVo specific," is a misguided attempt to herd would-be video subscribers into the TiVo format and away from the worldwide video content web.

Bad move, limited scope, consumer inflexibility and restricted horizons are some of the verbiage that enter my thinking when considering this attempted move. As of right now, the Amazon-TiVo team indicates the availability of about 10,000 video selections for their service offering. Umm, excuse me for being so crass but it sounds to me like they're "spitting" into the wind.

Just take as a token indicator the fact that for someone to use this questionable service, they need to have a high speed internet connection. So, if you're going to go with a high speed internet connection to grab some video content why in the world would anyone restrict themselves to a selection of 10,000 viewing opportunities and bypass their personal computer in the process?

I myself wouldn't touch this scenario with a 10-foot fiber optic cable. That is, if I had one.

The Amazon TV network?

Amazon (NASDAQ:AMZN) is launching a new and improved version of its Unbox video service. Research firm Stifel Nicolaus says the product puts the online store company right up there with Apple (NASDAQ:AAPL) for delivering net video to TV. In a description of the emerging net TV market, the research note states: "Amazon is farthest along in bringing online video to the television."

Unbox is available to over 1.5 million Internet-connected Tivo (NASDAQ:TIVO) subscribers. There is rapidly growing interest in getting feature length programming over the Internet to the TV. Blockbuster (NYSE:BBI) has indicated its plan to buy video on demand (VOD) firm Movielink. And movie rental firm Movie Gallery (NASDAQ:MOVI) plans to buy Disney's (NYSE:DIS) Moviebeam VOD business.

If Amazon is ahead in the race for Internet TV, it may be a relief to its shareholders. There has been a concern that the online store model will eventually produce slower growth as the number of people shopping on the Internet begins to peak. And investors have also been concerned that Amazon features like free shipping continue to pressure margins. The online retailer's shares are up only 5% over the last year.

But if online TV is as big a deal as companies like Apple and Blockbuster think it is, Amazon may get a new lease on its relationship with the Street.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Amazon cannibalizing its own DVD sales?

Amazon's UnBox movie downloads service scooped iTunes' own service launch. The strategic timing is merely a footnote on Amazon's desperate efforts. It does not make a difference if UnBox launched a week ahead of Steve Job's Sept. 12th announcement. Bloggers have been helping Amazon virally market its free introductory download offer, but investors have not warmed up to the news yet. Why?

Analyst reports have so far been skeptical. Matthew Himler covered a report from Carl Howe of Blackfriars Communications. I went back to Mark Cuban, whose thoughts I also valued regarding Apple's iTunes movie launch. Sure enough, Mark had something new to say, after reading a research note Palicapital's Rich Greenfield, specifically about the future of Amazon's UnBox.

Let's put aside my beliefs that movie downloads won't make a significant impact in the next few years. Let's also forget that Steve Jobs won't let Disney partner with Amazon because of his influence as a major Disney shareholder. Let's assume that movie downloads will be a meaningful source of revenue for Amazon. Why is it still a no-win situation?

Continue reading Amazon cannibalizing its own DVD sales?

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DJIA+44.2910,291.26
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S&P 500+5.501,098.51

Last updated: November 11, 2009: 08:06 PM

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