Netflix

Similar to the Xbox 360 Netflix service that recently came out, the functionalty is at no additional cost, you just need a Netflix account to use it. Engadget also got an early hand on experience. They said it is not as flashy as the Xbox 360 experience but the performance was noticably better. Netflix is certainly making a major bet on online distribution and they are moving fast to lock up key distribution channels from Blockbuster.  The recent deal that Microsoft and Blockbuster made to create a Live Mesh application is going to make this a game of chess and not checkers. 

Here is the press release:

LIGHTS, CAMERA, ACTION! MOVIES AND TV EPISODES FROM NETFLIX DIRECTLY TO THE TV THROUGH TIVO DVRs AVAILABLE TODAY

Just in Time for the Holidays, Offering Brings Budget Conscious Entertainment to Consumers

ALVISO, Calif. – December 8, 2008 – After announcing a groundbreaking partnership in October with Netflix Inc., TiVo Inc. (NASDAQ: TIVO), the creator of and a leader in television services for digital video recorders (DVRs), today announced that subscribers to both Netflix and TiVo® Series3, TiVo HD, or TiVo HD XL can now access thousands of movies and TV episodes instantly streamed from Netflix directly to their TVs.

The service is being offered at no additional charge to customers who subscribe to both services. This morning subscribers can browse through an expanding library of more than 12,000 movies and TV episodes at www.netflix.com, add them to their Netflix instant Queue, and then watch them on TV with just a click of the TiVo remote. The library includes titles from every genre, with a modest selection of HD content available as well. Both standard and HD titles are expected to grow in the weeks and months ahead.

“With so much talk focusing on the economy these days, this partnership makes more sense than ever because it brings people more movies at home, offering substantially more entertainment options than cable or satellite,” said Tara Maitra, GM and Vice President of Content Services at TiVo Inc. “TiVo offers consumers everything they need from just one box. Not only great content from Netflix, but also movies from The Walt Disney Studios and Amazon, music from Rhapsody, videos from YouTube and even pictures from Picasa Web Albums and Photobucket. And that’s all in addition to TiVo’s core functionality that made us a favorite in the first place. It adds up to a one-of-a-kind value.”

“Netflix offers an unbeatable combination of convenience, selection, and value, which now extends to TiVo customers,” said Netflix Chief Marketing Officer Leslie Kilgore. This partnership is a win-win-win for Netflix, TiVo, and consumers alike.”

Movies are streamed from Netflix through TiVo DVRs via wired or wireless broadband connection and a Netflix Queue-based user interface. Members visit the Netflix Web site to add movies and TV episodes to their individual instant Queues. Those choices will automatically be displayed on subscribers’ TVs and are available to watch instantly through the TiVo service. With the TiVo remote control users can browse their instant Queue, make selections right on the TV screen, as well as read synopses and rate movies. In addition, they have the option of pausing, fast-forwarding, rewinding and re-starting whenever they wish.

For more information on how to have movies instantly streamed from Netflix via your TiVo DVR visit www.tivo.com/netflix.

Blockbuster

Dallas News spoke with Keith Morrow of Blockbuster, which said “Eventually, we’ll give customers instant access to any movie on any device with an Internet connection and a screen.” Using Silverlight and Live Mesh, I think Blockbuster and Microsoft can build a compelling application.

The Blockbuster offering does not require any recurring fee or subscription like with Netflix. But Blockbuster seems to be really fragmented on their marketing strategy. First, they have a large investment in brick-n-mortar locations that they need to determine if its an advantage or disadvantage. Second, they need to simplify their distribution options. Right now they have distribution in-store, though mail, set-top box, and PC (through MovieLink) all of which don’t have an intergrated experience.

In an article in the New York Times, Blockbuster CEO Jim Keyes seems to be really out of touch.

Mr. Keyes says, is offering customers many ways to rent and buy movies: vending machines, subscriptions by mail and digital downloads. But more than 90 percent of the movies it distributes are still through stores. Over the next five years, he said, DVDs and Blu-ray discs rented in stores will continue to be the bulk of Blockbuster’s business. Mr. Keyes added that the growing interest in high-definition video, which can take five or six times as long to download as standard video, will make Internet movies even less attractive. “You can drive to our local store and rent a Blu-ray disc in less time than it will take you to download a movie in high-def,” he said.

This seems to be coming from a guy who is really out of touch with long-term technology trends. As broadband speeds increase over the next few years and fiber becomes more common place a HD movie will be downloaded in a matter of seconds. The consumer will want access to their content anytime and anywhere, and wont bother to drive to the local Blockbuster to get it.