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.

The news for Comcast (NASDAQ: CMCSA) and its cable peers could not get worse. Or could it? After posting mediocre earnings, the cable giant had to face concerns that the new AT&T (NYSE: T) U-verse IPTV product has been taking TV customers from cable companies at a rate much faster than Wall Street would have guessed. Comcast shares hit a 52-week low at $20.82.

Now, the FCC plans to void thousands of contracts that give cable companies exclusive rights to distribute TV into large apartment buildings. The New York Times writes that FCC "officials and consumer groups said the new rule could significantly lower cable prices for millions of subscribers who live in apartment buildings and have had no choice in selecting a company for paid television."

The move would open the door for satellite TV companies and the two big telephone firms, something that cable company stock prices can ill-afford.

Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX down .38 to 10.27.

Cisco Systems-(NASDAQ:CSCO) option implied volatility decreases; suggesting less risk

Cisco is recently up $1.17 to $28.45 after announcing better than expected financials. American Technology Research reiterated its Buy rating and $36 price target on Cisco because "we believe CSCO is best-positioned to drive converged (voice, data, video, wireless) IP networks." SBSH keeps its neutral rating on CSCO. CSCO call option volume of 100,807 contracts compares to put volume of 29,585 contracts. CSCO March option implied volatility of 24 is below its 26-week average of 28 according to Track Data, suggesting decreasing price fluctuations.

MasterCard-(NYSE:MA) February option prices bid up into 2/9 EPS & Outlook

MasterCard, a global payment solutions company, will report EPS on 2/9. Merrill Lynch has Neutral rating on MasterCard. MasterCard February straddle is priced at $9.30, above its theoretical value of $5.90 suggesting larger near term risks. MA call option volume of 4,279 contracts compares to put volume of 2,235 contracts. MA March option implied volatility of 40 is near its 26-week average of 38 according to Track Data, indicating non-directional price fluctuations in next six weeks.

Novelis-(NYSE:NVL) option implied volatility increase continues; indicating price risks

NVL, a manufacturer of aluminum rolled products with approximately 12,500 employees, and $8.4 billion in 2005 revenue, is recently up $4 to $40.85. Novelis said on 1/26/07 "it is currently in discussions with various parties that could lead to a potential sale of the company." BMOC Capital says "NVL has good assets, a strong market position and the potential to improve margins in the longer term, which could make it attractive for a strategic buyer." NVL March option implied volatility of 54 is above a level of 45 from yesterday, above a level of 34 from 2/5 and above its 26-week average of 39 according to Track Data, suggesting larger price risks.

Option volume leaders today were: Cisco-CSCO, Broadcom (NASDAQ: BRCM), Altria (NYSE: MO) and Intel (NASDAQ: INTC).

Although Apple Inc. (NASDAQ:AAPL) is about to release its AppleTV product that it hopes will bridge the divide among the PC and the living room entertainment center, how far has the consumer electronics world come in this arena?

There have been numerous attempts to actually make the TV and PC one device -- or at least a nice ecosystem -- but have any caught on with consumers? Not a one, although there are arguments that some devices have made "inroads."

I say, to where? Only one person I know of has a complete bridge between his TV and home entertainment system and the content of his PC as well as a live pipe to the Internet from the television/main living room.

Fans of Apple's stock are beginning to wonder what the company's next act will be. While iPod sales are still strong, the product has been around for five years now.

The primary concerns is that Apple has sold 70 million iPods, and with a footprint this big, year over year comparisons will inevitably slow. Mac sales have improved over the last five years, but since they are only half of Apple's sales they may not be able to to make up for any slowdown in the iPod. And companies like Dell and HP will do whatever they can to keep Apple's share from damaging their sales.

Prudential says that music player sales will slow to a 10% growth rate within four years.

Apple has an IPTV (Internet Protocol Television) device which will connect PCs to TVs. This may be out next year. Apple may also go into the cellphone market, but that puts it up against companies like Nokia and Motorola which have huge head starts.

Apple owes some of its success with the iPod to a "first mover" advantage. It does not have that with phones and computers.

And at $88, the stock is no longer cheap.

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