Netflix says exploring partnerships for TV video
By Sue Zeidler
LOS ANGELES, , Oct 22 (Reuters) - Netflix Inc (NFLX.O). (NFLX.O) is exploring sending movies and videos to television sets through Web-connected high-definition DVD players and Internet-connected game consoles, said Chief Executive Officer Reed Hastings on Monday.
"We are exploring a variety of options, including Internet-connected high-definition DVD players, Internet-connected game consoles and dedicated Internet set tops with a variety of partners," Hastings told analysts on a conference call after reporting better-than-expected third quarter earnings.
"We are trying to understand the best ways to provide inexpensive viewing of online content on the television," he said.
Netflix, the leader in online DVD rentals, in January unveiled its long-awaited Internet movie delivery feature, which allows subscribers to play back about 1,000 mostly older movies in real time via streaming video.
The company for quite some time has said it was looking to extend that service from PCs to the television.
Hastings on Monday said the company's long-term strategy was to offer a "hybrid service" by building a very large DVD rental subscriber base and bundling it with the ability to watch those movies online.
"While we are not yet in a position to provide investors the long-term financial model behind the hybrid service, we do want to reassure that we plan no large scale changes in our cash flow next year with, say, big hardware subsidies," he said.
Netflix will be competing in an crowded sector. Last month, movie-on-demand service Vudu launched, enabling viewers to choose from over 5,000 films that can be downloaded over the Web, stored onto Vudu set-top boxes, and then watched on television sets.
Vudu came on the heels of other companies like CinemaNow and Vongo that have struggled to gain mass appeal in offering movies on demand over the Internet.
Another prominent name in the sector is Movielink, which was originally backed by several Hollywood studios for five years before eventually being sold last month to U.S. movie rental chain Blockbuster Inc (BBI.N).
Netflix will also face pressure from an increasing amount of on-demand movie content offered on major cable and satellite operators such as Comcast Corp (CMCSA.O) and DirecTV Group DTV.N.
