Friday, January 1, 2010

Will Streaming Video Put an End to DVDs?

WATCHERS of streamingvideo trends have been buzzing ever since Netflix CEO Reed Hastings remarked in an early-October Motley Fool podcast that DVDs may lose their number one spot in the company’s video-distribution service after two years. Although Hastings didn’t explicitly say what he thinks will replace DVD, a few of his statements seem to agree with what many other experts have been declaring since the end of the format war: It won’t be Blu-ray. Hastings said many Netfl ix subscribers are switching to lower-priced plans that allow only one DVD to be out at a time but still offer unlimited streaming. Steve Swasey, Netflix director of corporate communications, clarifyed his boss’s comments a few days later. The reality is that all of Netfl ix’s services are growing—including DVD rentals, Swasey says. “Streaming video is growing fast because there is no base for before two years ago [when the service debuted],” he says. “You can’t say one format is going out or down, all are growing.” Still, an increase in streaming video makes sense when subscribers can instantly watch videos on their computers, broadband-enabled HDTVs, Xbox 360 consoles, and set-top boxes. Aft er all, the convenience beats a few days of waiting and multiple trips to the mailbox. Where does this leave Bluray? According to a March post on the Netflix Blog (, which Swasey confirms is still fairly accurate, Blu-ray is attracting only about 10 percent of subscribers. Netflix will continue to ship both DVD and Blu-ray media far into the future, Swasey says. The company’s approach is to continue offering bundled service, in which subscribers can choose how they want to watch movies. Besides, putting an exact date on DVDs’ demise would be like putting a date on when hybrid cars will outnumber regular ones, he says.

Source of Information : PC World December 2009

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