With the rising cost of postage and the incredibly low cost to stream a movie, even in HD, it's no wonder Netflix is pushing users towards streaming. A story on Bloomberg/BusinessWeek estimates that it costs Netflix only pennies to stream a movie:
The most promising area of growth, Sagan says, may be high-definition video, which has just started arriving on PCs. About 7 percent of all videos watched on the Web are in high-definition, up from 3.5 percent last year, according to researcher IDC, and by 2014 one-third of all online video will be HD. Frost & Sullivan says Akamai charges a customer like Netflix about 5 cents for an HD movie, compared with about 3 cents for standard definition. "We're right on the cusp of rapid adoption" of HD, Sagan says.
The savings is passed on to the studios, who used to only get revenue from the sale of the DVD, and now get paid every time a customer streams a movie.
Thanks to FearNo1 for sending this in.