The partnership between Netflix and LG Electronics announced prior this year’s CES is ready to enter in a new phase, as the LG BD300 Network Blu-ray Disc Player is ready for launch.
The South Korean maker said that the device, which is capable to play high definition Blu-ray discs, up-convert standard DVDs to 1080p and allow Netflix subscribers to instantly stream more than 12,000 choices of movies and TV episodes, will be available at retail starting this fall.
However, LG offered also a hint about the price, with the company officials saying that the new player, the LG BD300 Network Blu-ray disc, will be priced “well under $500”
Earlier this month, Netflix said it recorded its sixth quarter with profit growth in a row on the growing number of customers and the decreasing cost of adding.
The Los Gatos, Calofornia- based company posted a net income growth for the second quarter of fiscal year 2008 of 3.8 percent to $26.6 million, or 42 cents a share. During that same period last year, Netflix earned $25.6 million, or 37 cents.
Netflix, which has more than 55 million discs and ships 1.9 million of them to customers each day (on average), saw its sales increase 11 percent to $337.6 million. The company’s leadership forecasted a second-quarter revenue of $334 million to $339 million.
Netflix reduced its prices last year in order to draw more customers. The strategy contributed to the firm’s lowest cost to bring on new subscribers since Netflix became a public company in May 2002. In May, the company introduced a new device, Roku by Netflix, which allows movies sent by mail to be watched on television. Netflix, which sends movies by mail, finished the quarter with 8.4 million subscribers, while net subscriptions rose 168,000.
Also, at this year’s E3 Business and Media Summit Microsoft announced its new collaboration with Netflix that will allow to the Xbox 360 users to stream shows and movies directly on TVs.
The new service is intended to complement the already-made available Xbox Live Video Marketplace, rather than to replace it. Those Xbox 360 owners who had already subscribed to Netflix and currently have an Xbox LIVE Gold account will get the service for free.
Netflix is competing with several similar services. For example, at E3, Sony launched its own movie and television sales and rental service through the PlayStation Network. The content is provided by Fox, MGM, Disney, Paramount and Sony Pictures and the TV shows are available for 1.99 dollars per episode, while the movies can be rented for prices between 2.99 to 5.99 dollars. Those customers who wish to buy a movie will have to spend 9.99 or 14.99 dollars.
And, of course there is Apple TV. So far, Apple’s device failed to be a success, but in January at MacWorld, Steve Jobs introduced a new, cheaper, version, along with the introduction of movie rentals on iTunes.
Apple TV Take Two has new software that ensures a seamless integration with Movie Rentals, allowing movie fans to rent and watch movies right from their widescreen TV, with no computer required. A 40-gigabyte model is sold for only $229, while a 160-gigabyte model costs $329.
Apple has added the movies to its iTunes catalog in September 2006, but due to the lack of initial support from the movies studios, the business was going slowly, compared to the sales of digital music. However, earlier this year Steve Jobs managed to convince all the major Hollywood studios to join iTunes and last month the Cupertino company said that iTunes customers are buying 50,000 movies per day.
In May, Apple has announced that it would sell movies through its iTunes on the same day as the titles are released in DVD form. Studios previously gave DVD releases a head start of as much as 30 to 45 days over other distribution outlets to help preserve a major income source.
Also, in April there were rumors that Blockbuster is secretly working on a device which will allow video content to be streamed directly to a TV. Apparently the content will be provided by Movielink, a former joint-effort of MGM, Paramount, Sony, Universal and Warner, which was acquired last year by Blockbuster. Movielink has a library of 6,600 movies.
Also earlier this month, Amazon announced a new video on demand service called Amazon VOD, which will offer 40,000 movies and television programs. Amazon’s VoD will be available through Sony Bravia Internet Video link, a $300 device for Sony’s high-definition televisions. In the future Sony intends to embed the Amazon VoD as a standard feature.
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