Netflix's Video Game

Wednesday, January 20, 2010

It's a triple crown for Netflix (Nasdaq: NFLX). Beginning in the spring, the Wii will become the last of the three current video game consoles to get instant viewing of Netflix movies and TV shows over the Internet.

Wii owners who have a broadband connection and a Netflix subscription that costs at least US$9 a month will be able to watch those programs with no extra charge.

Nintendo and Netflix, which wouldn't give an exact launch date for the service, were set to announce the deal on Wednesday.

To watch flicks through the gaming system, Wii users will need a special "instant-streaming" disc that Netflix will mail out in the spring. They will then be able to use the Wii's motion controller to navigate through their Netflix account and pick what they want to watch. This setup is similar to the way Sony's (NYSE: SNE) PlayStation 3 currently streams Netflix programs.

Owners of Microsoft's (Nasdaq: MSFT) Xbox 360 can also stream Netflix, but the service is only available to Xbox Live "Gold" members, who pay $50 a year mainly to play games online.
Wrangling Wii

The Wii is a great catch for Netflix because it gives it access to the living rooms of millions of potential new subscribers. It is easily the most popular gaming console in the U.S. with 26 million sold in the country through December, according to Nintendo.

Netflix CEO Reed Hastings has long said his company's goal is to offer movie streaming on as many devices as possible, including all three gaming consoles. Letting subscribers watch movies over the Internet is an increasingly important service for Netflix, which is based in Los Gatos, Calif., even though the company says it expects to keep renting DVDs for another couple of decades.

Part of the reason for that is because it'll take some time for movies to become available for streaming. The company has about 17,000 movies and TV shows available for Internet watching, compared with more than 100,000 DVD titles it rents out.

In another sign of its commitment to streaming, Netflix said last week it will delay sending out Warner Bros.' latest movies by nearly a month so it can get rights to show its subscribers more movies over the Internet.

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