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Netflix to Offer Streamed Content in Canada

19 Jul, 2010 By: Erik Gruenwedel

Netflix July 19 said it would bow movie and television program streaming into Canada this fall, marking the Los Gatos, Calif.-based online DVD rental pioneer’s first foray (streaming only) outside the United States.

Netflix has been entertaining plans to launch its streaming service abroad, a move many observers believed would be in England. The launch in Canada would coincide with the store-based departure of Movie Gallery, which recently shuttered more than 177 locations in the country.

Netflix has said that 50% of its 14 million subscribers watch at least 15 minutes of streamed content (mostly TV programming) per month. Since 2008 Netflix has significantly increased its subscriber base through expansion of its Watch Instantly streaming service via a myriad of media devices, connected televisions and video game platforms, including Sony's PlayStation 3, Nintendo's Wii and Microsoft's Xbox 360.

Last week Netflix expanded an existing streaming agreement with Warner Bros. Home Entertainment to add catalog TV shows, including all 100 episodes of “Nip/Tuck.”

The initial launch (www.netflix.ca) will be in English and presumably as a subscription, not transactional, service. Rollout of service in French is expected next year.

Netflix is expected to announce the addition of 700,000 subscribers in June when it reports second quarter results July 21, according to Citigroup analyst Mark Mahaney.

The analyst believes 9,500 households are affected by the closure of a Blockbuster store. With the chain expected to shutter 500 locations this year, Mahaney projects a market void of more than 4.7 million households for home entertainment, including local video stores, kiosk vending, subscription rentals and transactional video-on-demand (VOD).

Separately, online market research firm TheMotleyFool.com reiterated speculation why Amazon should purchase Netflix. Specifically, analyst Jeremy Philips wrote that such a deal would double to more than 40 million the unique monthly visitors to the Internet Movie Database (IMDb.com), which is owned by Amazon.

“By bolstering IMDb’s position as the only place on the Web to research, buy, and [with a Netflix acquisition] rent movies and TV shows, they would give Web visitors zero reason to go elsewhere,” Philips wrote.

Of course, Amazon could just keep charging Netflix for periodic links on IMDb, which it also does for Blockbuster’s by-mail service.


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