Online DVD rental company Netflix Inc is unveiling its long-awaited online movie delivery service which allows subscribers to watch about 1,000 movies and television shows on their personal computers at no additional charge. Netflix Chief Executive Reed Hastings is set to demonstrate the "instant viewing" feature on Tuesday at the National Retail Federation convention in New York, where the company will receive an award for retail innovator of the year.
Hastings told Reuters in an interview on Friday here that the feature was aimed at under-30 Internet users who made video-sharing sites like YouTube.com popular. "For consumers under 30, they are doing so much with online video this is a natural extension of their usage paradigm on a laptop," Hastings said. "Eventually we want to be on every Internet-connected screen from cell phones to computers to big screen plasma TVs but the starting place is the PC."
Its instant viewing feature, available only on computers that run the Windows XP and Vista operating systems, plays back DVD-quality digital files almost instantly after subscribers install special software from the Netflix site, a process that takes about 20 seconds. It does not download large movie files to consumers' computer hard drives, but "streams" them directly from the Internet, meaning that users must stay connected to the Web, either through a cable or wireless connection, while viewing a movie.
The feature, which cost Netflix about $40 million to develop, is designed to adjust the picture's resolution based on a user's cable bandwidth so that the movie doesn't freeze during play. Online movie viewing time is awarded to Netflix subscribers based on their rental plans, with entry-level subscribers getting six hours per month and those with the most popular plans--three DVDS at a time-- getting 18 hours per month. Netflix has inked deals to stream online content from NBC Universal, Sony Pictures, Metro-Goldwyn-Mayer Inc, 20th Century Fox, Paramount Pictures, Warner Bros., Lionsgate , New Line Cinema and a number of television studios on the new service.
News source: Reuters