Hacking NetFlix

Inside the Netflix User Interface on Devices

Matt Seeley, UI device engineer at Netflix, posted his talk Webkit in Your Living Room on the Netflix Tech Blog. Seeley explains how they designed the User Interface for more than 450 devices that are used in more than 40 countries. Lots of great information and some background on how & why the Netflix UI on devices looks and works the way it does.

Redbox Sees Huge Growth as Video Stores Close

Home Media Magazine posted year end DVD market share results:

Redbox saw its unit volume in disc rentals skyrocket 29% in 2011, as traditional brick-and-mortar video stores continue to cede market share, according to new data from The NPD Group. The kiosk vendor’s share of DVD and Blu-ray movie rentals rose from 25% in 2010 to 37% in 2011.

At the same time, Blockbuster saw its market penetration decline to 17%, while Netflix’s physical disc rental market share was flat year-over-year at 30%, despite falling to a two-year low of 25% in the fourth quarter as the service and subscribers transition to streaming.

via InsideRedbox.

Netflix Might Get Access to Twilight Movies Because of Lionsgate Summit Purchase

Fool.com reports that since Lionsgate bought Summit Entertainment, Netflix & Redbox might have access to the Twilight movies.

There should be champagne corks popping in the headquarters of both Coinstar's Redbox and Netflix over the SummitsGate announcement.

Both movie-rental specialists have distribution deals with Lionsgate, see. The Redbox terms are unknown, but most likely include cheaper access to Lionsgate discs. For Netflix, the bubbly is even more in order: Through an indirect deal with Lionsgate via Epix, the company gets streaming access to a large portion of Lionsgate's content library.

Importantly, the streaming rights from Epix are exclusive. If I'm reading the contractual tea leaves right, the Twilight series is now available for Netflix to exploit.

Thanks to Brad for sending this in.

Netflix Faces A Class Action Lawsuit on Behalf of Institutional Investor

Robbins, Geller, Rudman & Dowd, LLP have filed a class action lawsuit against Netflix on behalf of an institutional investor. 

The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business practices and its contracts with content providers. As a result of defendants' false statements, Netflix's stock traded at artificially inflated prices during the Class Period, reaching a high of almost $300 per share on July 13, 2011. While Netflix stock was inflated (partially by Netflix buying back its own stock), Company insiders were selling 388,661 shares of their own Netflix stock for proceeds of $90.2 million.

On September 15, 2011, Netflix updated its third quarter 2011 guidance and revealed that it had lost a million subscribers due to its recently announced price increases becoming effective. On this news, Netflix stock fell nearly $40 per share to close at just under $170 per share. On September 19, 2011, the Company announced that, in an effort to offset skyrocketing costs and rapidly defecting customers, the Company would begin charging separately for its two services and had raised prices as much as 60%. Netflix stock dropped to $130 per share on this news. Then, on October 24, 2011, Netflix issued its third quarter 2011 shareholder letter, which reported a net loss of 810,000 U.S. subscribers, translating into a cumulative loss of 5.5 million subscribers. The subsequently filed Form 10-Q revealed that Netflix's obligations for content over the coming years had skyrocketed to $3.5 billion, with $2.8 billion due within three years. These disclosures caused Netflix stock to collapse from $118.84 per share on October 24, 2011 to $80.86 per share on October 27, 2011, a 32% decline in three days and a 73% decline from the stock's Class Period high.

Thanks to FearNo1, Marshall, and everyone else that sent this in.

Rumor: Netflix Shipping Center Layoffs Because of Declining DVD Shipments?

An anonymous source told HackingNetflix that about half of the staff at Netflix's Central Ops shipping center in Grove City, Ohio were laid off due to a huge drop in DVD shipments. The source said that the shipping center could process as many as a million discs per week, but was recently processing a fraction of that.

It looks like the transition to streaming is happening very quickly at Netflix. The Netflix earnings and Q&A call next week should be very interesting...

Netflix DVD Division to Remain in Los Gatos, Sales Tax Revenue Too

The San Jose Mercury News notes that since Netflix's DVD division will remain in Los Gatos, the estimated $1.5 million in sales tax revenue will as well.

"It now appears that Los Gatos will continue to receive all of the local sales tax resulting from Netflix DVD subscriptions in California," Larson said in an email. "This change is a result of town discussions with Netflix over the past few months, following their decision to keep the DVD business unit part of Netflix."

That's good news for Los Gatos, which is facing a $4 million budget deficit in the 2012-13 fiscal year.

In the heyday of DVD-by-mail rentals, Netflix generated about $3 million in sales tax revenue for Los Gatos, but that figure has declined as the company moves to the streaming business model.

How the Online Video Services Compare on Hit Movies

Tristan Louis at TNL.net compared hit movie availablility at Netflix, Amazon, iTunes, Vudu and DVD. 

The past year has seen an increas­ing align­ment in the libraries of titles offered by online stream­ers in an on-demand basis. At the same time, we have seen Net­flix appar­ently aban­don its strat­egy of offer­ing pop­u­lar movies on a sub­scrip­tion basis. Next week, I will look at whether Netflix’s efforts are get­ting more focused on tele­vi­sion streams or whether we are see­ing them pull back across the board in terms of avail­abil­ity of more recent content.

We are also see­ing Hol­ly­wood now treat­ing online as more equiv­a­lent to DVD sales, offer­ing titles for sale online at roughly the same rate as they do on DVD. Let’s hope that this trend con­tin­ues to hold and that the indus­try sees the wis­dom of pro­vid­ing online streams in an ear­lier release win­dow. A few inde­pen­dent movies have done simul­ta­ne­ous releases online and in the­aters this year and Hol­ly­wood has a poten­tial to increase its rev­enues if it were to increas­ingly go in that direction.

The Real Problem With The Anti-Piracy Bills

I think our "representatives" in Washington got the message with all of the outrage and protests behind SOPA today. Of all of the commentary, this quote really bugged me:

““Why is it that when Republicans and Democrats need to solve the budget and the deficit, there’s deadlock, but when Hollywood lobbyists pay them $94 million dollars to write legislation, people from both sides of the aisle line up to co-sponsor it?””

- Reddit Founder Alexis Ohanian on CNBC.

Piracy wouldn't be a problem if the studios and record lables would make content available widely for a fair price, and stopped treating paying customers like theives by using DRM.

via Wil Wheaton.

Quentin Tarantino's Top Movies of 2011

Love his movies or hate 'em, Quentin Tarantino has announced his top 11 movies for 2011, as shared with Tarantino.info. 

1. Midnight in Paris
2. Rise of the Planet of the Apes
3. Moneyball
4. The Skin I Live In
5. X-Men: First Class
6. Young Adult
7. Attack the Block
8. Red State
9. Warrior
10. The Artist / Our Idiot Brother
11. The Three Musketeers

It's also worth checking out other movies he liked as well.

Hulu Hits 1.5 Million Paid Subscribers & Shares Original Programming Plans

The Hulu blog shared some interesting numbers, including 1.5 million paid subscribers ("faster than any other video subscription service").

We grew the business 60% from 2010 to approximately $420 million in revenue. We exceeded our plan despite the soft advertising market (economy) in the second half of 2011. Overall the Hulu ad business grew aggressively and Hulu Plus materially exceeded our plan.

Hulu also announded a new lineup of original programming, starting with the show Battleground. 

The line-up kicks off on February 14 with the launch of Hulu’s first original scripted series, “Battleground,” executive produced by JD Walsh, Hagai Shaham and Marc Webb (“The Amazing Spiderman,” “500 Days of Summer”). On the heels of a successful season as Hulu’s first original series, Morgan Spurlock’s “A Day in the Life” will premiere its second season in March. And this summer, Hulu audiences will get exclusive access to acclaimed writer/director Richard Linklater’s first episodic documentary series, “Up to Speed.”  All three shows will be available exclusively on the free, ad-supported Hulu service and the Hulu Plus subscription service.

Here's a trailer for the Battleground show:

It's great to see Netflix, Hulu and others working on original programming. If the shows are half as good as what HBO is doing it'll be a big improvement over prime time.

Thanks to Marshall and everyone else for sending this in.