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Netflix brings streaming to the PS3, plans to roll out streaming service internationally
October 26, 2009
Netflix has announced a partnership with Sony to bring its Watch Instantly (WI) streaming service to broadband-connected PS3 games consoles in November 2009. Netflix DVD subscribers will be able to access the streaming library through the console at no additional cost.
At launch, the service will be enabled using a Blu-ray disc (BD). The disc, which will be freely distributed by Netflix, will use BD-Live to activate the streaming interface. Users will be able to add videos to their WI queue directly through the PS3. Netflix already has streaming deals in place with several hardware manufacturers including Microsoft, LG and Samsung.
The DVD rentailer has also signaled it is to launch its online video streaming service internationally in 2H 2010. Initial roll out will be limited to a single, unnamed country with the potential for further territorial expansion at a later date. Outside the US Netflix will focus on developing streaming-only offerings rather than a DVD rental business.
The company revealed that 42 per cent of its 11.1m subscribers streamed at least 15 minutes of video in 3Q 09, up from 22 per cent in 3Q 08.
In the US consumption through WI, which is provided as a free value-add to DVD subscribers, has grown substantially over the last 12 months. Growth has been aided by Netflix's multiple deals with consumer electronics manufacturers, allowing streams to be delivered directly to the TV screen through broadband connected games consoles, Blu-ray players and other devices.
Netflix's plans to bring streaming to the PS3 marks the end of the Xbox 360's position as the only console capable of accessing WI. With an installed base of 5.4m broadband-connected PS3 consoles forecast for YE 09 in the US, the Netflix-Sony deal will widen the number of users capable of viewing WI videos directly through the TV screen. Any Netflix subscriber with a connected PS3 will have access to the streaming library, contrasting with the Xbox 360 WI proposition which requires users to subscribe to both Netflix and to Xbox Live Gold (the latter costs $49.99/year). Unlike Sony, Microsoft is directly monetizing its console's Netflix functionality by upselling users to a Gold subscription.
Both console manufacturers are continuing to position their hardware as entertainment hubs, offering more than just gaming. While the Xbox 360 is no longer the only console delivering WI to the TV screen, Microsoft's console provides some additional features around WI content which are not available on the PS3. Xbox 360 owners can view WI streams concurrently with other users, interacting around the content. Microsoft may regain its edge over Sony in video provision later this year when it upgrades it online video store, introducing 1080p streaming.
Netflix has not announced how it will monetize a streaming-only offer outside the US but if the company were to mirror its domestic business and adopt a subscription model the service is likely to meet with limited success. A standalone online subscription would not include new release movies - titles only become available in the subscription window around a year after theatrical release, and even then are the subject of intense competition from local pay-TV operators and premium channel groups.
Netflix's plans to bring streaming to the PS3 marks the end of the Xbox 360's position as the only console capable of accessing WI. With an installed base of 5.4m broadband-connected PS3 consoles forecast for YE 09 in the US, the Netflix-Sony deal will widen the number of users capable of viewing WI videos directly through the TV screen. Any Netflix subscriber with a connected PS3 will have access to the streaming library, contrasting with the Xbox 360 WI proposition which requires users to subscribe to both Netflix and to Xbox Live Gold (the latter costs $49.99/year). Unlike Sony, Microsoft is directly monetizing its console's Netflix functionality by upselling users to a Gold subscription.
Both console manufacturers are continuing to position their hardware as entertainment hubs, offering more than just gaming. While the Xbox 360 is no longer the only console delivering WI to the TV screen, Microsoft's console provides some additional features around WI content which are not available on the PS3. Xbox 360 owners can view WI streams concurrently with other users, interacting around the content. Microsoft may regain its edge over Sony in video provision later this year when it upgrades it online video store, introducing 1080p streaming.
Netflix has not announced how it will monetize a streaming-only offer outside the US but if the company were to mirror its domestic business and adopt a subscription model the service is likely to meet with limited success. A standalone online subscription would not include new release movies - titles only become available in the subscription window around a year after theatrical release, and even then are the subject of intense competition from local pay-TV operators and premium channel groups.
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