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TV a Big Part of Netflix’s Streaming

22 Nov, 2010 By: Stephanie Prange

While Wall Street pundits have proclaimed that Netflix’s streaming growth is coming at the expense of packaged media, it looks to me that the subscription service’s streaming is actually complementary to traditional forms of entertainment.

In a recent speech, Netflix chief content officer Ted Sarandos said repurposed television shows account for 50% of streaming content for Netflix subscribers (see story). And now Netflix has bowed a streaming-only option (see story).

Sarandos rightly said that subscribers like to stream in short bursts, and that the service is complementary to existing cable and satellite service.

“It fits peoples’ lifestyles,” he said.

That makes sense to me.

While on a plane, at the gym or waiting in line, I’d like the ability to stream a TV show on an iPod, iPad or other mobile device. I’m not exactly going to haul around a laptop to view an entire feature-length movie on Blu-ray Disc or DVD just to run errands.

Even on the plane, where there are so many interruptions, viewing a short TV show on my mobile device cuts down on the amount of equipment I have to lug around and offers a snack-sized bite of entertainment when I may not be able to get fully engrossed in a feature.

Having access to Netflix on your mobile device is like owning a library of TV reruns that can be viewed to pass the time. I recently saw an amusement park attendee viewing her iPad while waiting for her kids to get off a ride. I doubt she was perusing an feature-length drama. I’m betting a TV episode would last about as long as it would take for her kids to finish the ride (it was a slow day, after all).

On a mobile device to pass the time, lower-quality video streaming fits the bill. Most folks aren’t looking for top-notch picture and sound while on the move, but just a bit of entertainment to pass the time while they wait in line at the post office or trudge on the treadmill at the gym.

That’s why Blu-ray sales continue to grow at the same time streaming services such as Netflix also flourish. They serve two different, but ultimately complementary, consumer needs.

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