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Netflix to Stream in HD

4 Nov, 2008 By: Erik Gruenwedel

It takes a laissez-faire attitude toward Blu-ray, but that isn’t stopping Netflix from quietly offering movie streams in high-definition later this month.

The Los Gatos, Calif.-based online DVD rental pioneer is set to bow about 300 streamed titles with the Microsoft Xbox 360 possibly in two weeks, in addition to the proprietary Roku-manufactured set-top by the end of the year, according to spokesperson Steve Swasey.

In an online post, Tim Twerdahl, VP of consumer products with Roku, confirmed the streams would be delivered at “substantially” lower bit-rates than Xbox and in 720p resolution.

In addition, Twerdahl said the Roku user interface would be updated to include more on-screen movie title selections.

Swasey said the HD rollout would be “underwhelming” due to the number of titles offered and the fact the audio would be in standard definition, not 5.1 audio.

“It’s not a big announcement at all,” Swasey said. “It’s just [putting] a HD stake in the ground.”

Last month, Netflix said the overall impact of the HD packaged media remained a work in progress as Blu-ray usage continued to be a small percentage of the subscriber base.

The service said it expected about 500,000 (5.7%) of its nearly 8.7 million subscribers to be Blu-ray subscribers by the end of the year — generating about $6 million in incremental annual revenue when factoring the recently announced $1 monthly surcharge.

Separately, Swasey denied media reports that suggested Netflix was phasing out DVD after it announced in e-mail it would discontinue selling used titles on its Web site.

He said the company decided the resources needed to run that operation were not warranted.

“We decided we’re a DVD rental company, not a sales company,” Swasey said. “We see DVDs continuing, for five to 10 years, to grow in popularity for rental.”


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