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Rafat Ali from paidContent interviewed Netflix CEO Reed Hastings at the NewTeeVee Live Conference:
During the interview, Hastings said that money was the biggest factor in expanding the streaming movie collection. "If we had more money to pay the studios we'd get more content."
Interesting tidbit from the interview: Hastings said that the studios get 30-35% of the revenue from DVD rental, but about 70% from streaming.
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It's fine with me that he doesn't have more money to offer the studios, since that money ultimately has to come from me. And while WatchNow is a nice add-on, I don't mind waiting a day or two for a DVD to arrive.
It would be interesting to know more about what those "percentage of revenue" figure mean. What formula does he use to divide my $18 between streaming vs. DVD? And the more interesting question is - what is the relative profitability of streaming vs. DVD? How much cheaper (if at all) is it to deliver a two-hour movie over WatchNow than by physical DVD?
Posted by: Hunter McDaniel | November 17, 2008 at 02:12 PM
Then why is Netflix charging an extra $1 per month for Blu-Ray users, but not charging an extra premium for Streaming users? I'd love to turn of streaming on my account if I could save a buck a month.
(I know they don't charge extra for streaming since they want to move people to that technology, I just asked it to make a point.)
Posted by: Craig | November 17, 2008 at 05:44 PM
Interesting interview. I would have liked to hear, though, is how the upcoming caps on internet traffic from the major isp's will affect Netflix streaming.
Posted by: John C | November 17, 2008 at 05:55 PM
Interesting interview. I would have liked to hear, though, is how the upcoming caps on internet traffic from the major isp's will affect Netflix streaming.
Posted by: John C | November 17, 2008 at 05:56 PM
I'd be curious to learn what percentage of my monthly bill goes to pay for streaming. (In fact it goes to pay for other people's streaming, since I rarely use that feature.)
Posted by: CopaceticOpus | November 18, 2008 at 01:37 PM