Hacking NetFlix

Netflix Closing Red Envelope Entertainment Division

The LA Times reports that Netflix is closing the Red Envelope Entertainment division because "...the Red Envelope Entertainment unit competed with its main suppliers, Hollywood studios." A Netflix spokesperson told HackingNetflix that only 4 employees will be moving on (the L.A. Netflix office has 77 employees).

Netflix's Red Envelope Entertainment invested in more than 100 films, including Sherry Baby, Helvetica, Confessions of a Superhero, John Waters: This Filthy World, and Cowboy del Amor. You can view the entire list of Red Envelope Entertainment movies on the Netflix website (many are available through through Netflix's Watch Instantly).

I'm really disappointed that Netflix has decided to stop buying independent films. There are so many great small films that languish because they can't find an audience or get funding, and Netflix was able to provide both. In a 2006 Wired story, Ted Sarandos, Netflix's chief content officer, said that he eventually wanted to buy every film at Sundance.

via paidContent.

Major Nelson's Video Tour of Netflix on the Xbox 360

Larry Hyrb, aka Major Nelson, gives a sneak preview of Netflix on the Xbox 360 in the following video:

via Engadget.

Netflix CEO Reed Hastings Talks About the Xbox 360 Netflix Player (& More)

Netflix CEO Reed Hastings answered a few questions from HackingNetflix about the Xbox 360 Watch Instantly partnership:

Why the Xbox 360 instead of Sony's PS3? It includes a Blu-ray player. The Xbox 360 is outselling the PS3 domestically about 2 - 1.
Is this an exclusive relationship? Hastings confirmed that it is exclusive to the Xbox 360 (eliminating hopes for a Wii or PS3 player).
When will Netflix on the Xbox 360 be released? It will be released in "late fall" (the last day of fall is December 20th).
Is there anything else required to Watch Instantly on the Xbox 360? In addition to the Xbox 360, a "Live Gold" membership is required, at a cost of about $50 per year.
What are the Xbox movie sharing features? Hastings said that this was a "creative adaptation" of the Netflix Player, enabling multiple people in separate locations with Xbox 360's to stop, pause, and watch a movie simultaneously.

Can you give us a hint about the next device to support Watch Instantly? The already announced LG Netflix Player will be released in the next two quarters, but he hinted that a Blu-ray player could be next.
Why is there a limit to the number of Watch Instantly devices for each account? It's a studio restriction.
Are you expecting a price increase? Netflix is always testing prices, but nothing is planned. Netflix has discussed the potential for a price increase on Blu-ray rentals, since the discs cost more to purchase. Hasting said that if there was an increase, it would be "modest."
When will Macintosh support be available for Watch Instantly? Q4.
What about Watch Instantly on the iPhone? Not planned at this time.
The last time we spoke you recommended Juno. What's your current movie recommendation? Anvil.

The following is a promotional Netflix-branded Xbox 360, which will not be available for sale:

What do you think? Are you disappointed by the exclusive? Looking forward to watching movies on the Xbox 360?

The Boston Globe on Netflix's Unlimited Vacation Policy

The Boston Globe featured Netflix's Steve Swasey in a story about companies that offer unlimited vacation time, Is Unlimited Vacation a Good Thing?

"We're always on, 24/7," says Swasey, a Netflix spokesman, who admits to checking his BlackBerry throughout a recent trip to Chile with his wife. Still, he insists cheerfully that he and his colleagues are "not being workaholic. It's being engaged with your job because you love what you do." Thanks to Netflix's unlimited vacation policy, Swasey leaves the office a lot. But the office usually goes with him.

New Releases for July 22nd, 2008

Click here for the full list of new releases this week (84).

Interesting titles include 21, Turn The River, Duck, Spaced: The Complete Series, 21 Up South Africa: Mandela's Children, Satantango, Shark Week: Ocean of Fear, L.A. Ink: Season 1, Robot Chicken Star Wars, Big Dreams, Little Tokyo, Dirty Money, Brutal Massacre: A Comedy, Comedy Central's TV Funhouse, The Last Winter, and CSNY Déjà Vu.

Netflix Sending Class Action Lawsuit Settlement Notification E-mails

Several readers have reported that Netflix has started sending e-mails notifying customers that they will receive an automatic upgrade to the next plan as part of the settlement in the Frank Chavez vs. Netflix class-action lawsuit:

From: Netflix
Sent: Sunday, July 20, 2008
To: netflixcustomer@mail.com
Subject: IMPORTANT: Your Netflix Settlement Benefit

Dear Customer,

As a member of the Chavez vs. Netflix settlement class, you will receive a free upgrade to the next plan level for one month. Assuming your membership remains active for the remedy period, this benefit will automatically start with your next billing period and will appear in your Membership Terms and Details page.

No further action is necessary on your part.

NOTE: If your Netflix account is on hold, your upgrade will automatically apply for the next billing period after you remove your account hold.

Learn more about this settlement at:
http://www.netflix.com/settlement

-The Netflix Team

Thanks to Francis and John for sending this in.

Netflix Profiles Are Back

As promised, Netflix has enabled the ability for customers to create and manage Profiles. To view your Profiles, go to "Your Account" and you should see the following:

Thanks to Chris and Paul for sending this in.

New Releases for July 15th, 2008

Click here for the full list of new releases this week (74).

Interesting titles this week include The Bank Job, Meet Bill, Penelope, Trafic, The Year My Parents Went on Vacation, Love My Life, Saving Grace: Season 1, Never Forever, and Final Approach.

Breaking: Netflix & Microsoft Partner to Bring Watch Instantly to The Xbox 360

Engadget reports that at E3 Microsoft and Netflix announced that the long-rumored partnership will bring Netflix's Watch Instantly to the Xbox 360.

Microsoft says the 360 will be the only game system that allows Netflix access for no additional cost, and what's more, streaming movies can be shared with your Live party, allowing you to watch content together. Users will have instant access to their Netflix instant access queues, but it's not clear what resolution the content will be streamed at -- we'd guess it's roughly the same DVD-quality res as Roku's Netflix streamer for now, but anything could change when the service launches in the fall witht the new dashboard.

It's a perfect partnership: Microsoft can sell or rent the new releases, and Netflix adds value with 10,000+ movie and TV shows. Oh, yeah -- the Xbox 360 also plays games. The only thing missing is a Blu-ray player...

Why Microsoft's Xbox 360 over Sony's PS3? It could be that Reed Hastings is a member of Microsoft's board of directors, or that Sony might want to compete with Netflix (Sony was a founder of Movielink, which is now owned by Blockbuster).

With Xbox 360 prices as low as $299, would you buy an Xbox or Roku's Netflix Player?

Thanks to Erie, Doron & Steve for sending this in.

Video Store Downsizing, Not Blaming Netflix

The Novato Advance has the story of the last small video stores in Novato, which is downsizing to save money, not because of Netflix or DVD rental kiosks:

Surprisingly, the mail-order Netflix service, widely credited with creaming Blockbuster’s rental empire, didn’t have a huge impact on smaller video stores, Hambly said.

“Netflix, everyone was worried about that, but we noticed we really didn’t take a big hit,” he said. “The people who went to Netflix, they didn’t rent much in the first place. We didn’t miss most of them.

Hambly said he also wasn’t too worried about supermarkets’ automatic DVD-vending kiosks.

“I looked into those at a convention, and I thought they would be a good idea,” he said. “But while it’s a $1.49 each day, for each additional day, it dings your card another dollar … I think it’ll be popular because it’s new, but then people will see how much it’s charging their accounts. (Also), if they’ve got the 50 top movies that came out, they’ve got ten of each. If you want ‘The Ruins,’ it’ll be gone real soon. If you go to another store, you’re wasting gas and time. We’ll have forty copies of a good movie.”

Netflix: Possible Short Wait?

Update: The reader reports that his queue is back to normal now.

A reader in Columbia, SC area sent in a rather strange screen capture of his queue showing every movie as "Possible Short Wait:"

Is anyone else having a similar problem?

CNet Takes A Look Inside Roku's Netflix Player

CNet literally goes inside Roku's Netflix player, with a photo essay that takes a Netflix Player apart.

I also took mine apart (Flickr), and it worked when I put it back together (unlike the toaster I took apart as a child).

Netflix Queue "Replaced" Notice

Sameer writes, "I got a weird message in my queue today. It simply said: "Shadows has been replaced by a different version."

This message means that a new version of the movie has been released, or Netflix replenished stock with a different version of the movie. I've seen other notices, such as "Grindhouse has been removed from your queue."

Netflix Updates Genre Pages

Meghan on the Netflix Community Blog writes that Netflix has updated genre pages:

There are larger images, and easy-to-scan rows. You can use 'sliders' to click through to more movies without leaving the page, like we have in our new releases section. If you don't want to use the 'sliders', you can choose to see the full set in a new page. These are in a gallery-type format, and you can toggle to see them in a sortable list view. We also updated the color scheme.

The new pages are responsive, so if you rate movies you'll likely see a row of suggestions for you in that genre, and we will highlight your preferred sub-genres as well.

Here's the "Classics" genre with sliders:

If you select a genre, you now get a full page of movies:

Or you can select the "List View" that you can sort by title, year, MPAA rating, or user rating:

What do you think about the new genre pages?

Netflix Q2 2008 Earnings Conference Call on July 25th, 2008

Netflix will host an investor webcast on July 25th, 2008 at 5:30am PT to discuss Q2 2008 results. The webcasts are usually very interesting, and anyone can listen in at http://ir.netflix.com.

Did Netflix Make the Right Decision to Keep Profiles?

Netflix reversed the decision to eliminate the Profiles feature last week, and the reason, according to Todd on the Netflix Community Blog: "We were persuaded by the well-reasoned, sincere responses of loyal members who very much value this feature."

Joel Mier, the former Director of Consumer Insights for Netflix, believes Netflix should have stuck to their guns and removed the Profiles feature. He posted the following on his blog, Think for a Moment:

I think Netflix made the wrong decision to reverse itself. It has essentially told its customer base that (no matter how "small a minority") if it is vocal enough about something, Netflix will capitulate. This is the precedent it made on June 30, not a position in which a company wants to be.

I liken it to parenting. Imagine I am with my small child in a grocery store and she wants to have a candy bar. Being that it is 9:00 am, I know, as the adult, that it is not the right thing to do and tell her "no." In response to this disappointing news she begins to scream and throws a tantrum on the floor.

I now have two choices. I can cave in and calm the situation by giving her what she wanted in the first place. This has the impact of defusing the situation but does nothing for doing what is right as a parent. Her tantrum gave me no new information about the correctness of a small child having candy at 9:00 in the morning, did it? Clearly not.

The other choice, the right choice, is to pick up my child and under the glare and judgment of every patron in the store, immediately cease my shopping trip and carry her out to the car where she can scream with wild abandon within our minivan. And, may I add, without the candy. That is the right thing to do.

And Netflix? They opened a candy store on June 30, 2008.

What do you think? Did Netflix do the right thing, or will this decision cause trouble when they make other unpopular decisions in the future?

Netflix Settlement Notices by November 29th

While Netflix hasn't specified when members of the settlement class will receive a free month or one-level upgrade, the Netflix Settlement website confirms that "The settlement is now final as the period for further appeals has expired."

If you look at "Your Account" and "Membership Terms and Details" and you are part of the Netflix Settlement class, you should see the following notice:

You are a member of the Chavez vs. Netflix settlement class, and you will be notified via email by November 29, 2008 regarding your benefit and claim procedure.

Thanks to Joshua & Baff for sending this in.

Netflix Blu-Ray Availability Update

Netflix promised to increase Blu-ray availability earlier this year, so it's a good to take another look at the situation. How would you rate Blu-ray availability at Netflix or Blockbuster?

30% of Consumers DVD Pirates?

The Consumer Home Piracy Research Findings July 2008 Report (PDF), commissioned by copy protection firm Macrovision, claims that nearly 30% of consumers pirate DVDs.

Although the majority of people are copying from their own purchased DVD in both the UK and USA, a significant proportion of people are copying from rented and borrowed titles.

Despite the annoying anti-piracy campaign by the MPAA, I still get e-mails asking if it's legal to copy a DVD rented from Netflix or Blockbuster. If you copy a rented DVD, it violates the Netflix terms of use:

Netflix reserves the right to terminate your membership hereunder if Netflix, in its sole and absolute discretion, believes that you are in violation of this paragraph, such violations including the copying of DVDs rented to you by us, the unauthorized use of our instant watching movie feature, the Netflix Movie Viewer Software or the copying or other unauthorized use of our proprietary content. Netflix does not promote, foster or condone the copying of DVDs or any other infringing activity.

While you're supposed to be able to create a backup copy of a DVD you purchased (fair use), using software to decrypt the copy protection on a DVD violates the Digital Millenium Copyright Act.

via PC World.

New Releases for July 8th, 2008

Click here for the full list of new releases (88).

Interesting movies this week include

Chop Shop, Sleepwalking, Stop-Loss, The Tracey Fragments, Journey To The Center of the Earth, American Zombie, Little Chenier, Flakes, Superhero Movie, 2 Minutes Later, Phoenix Mars Mission: Ashes to Ice, Cannon: Season 1, Fastlane: The Complete Series, Jake & the Fatman: Season1: Volume 1, In the Year of the Pig, Gurren Lagann: Vol. 1, and Batman: Gotham Knight.

Roku Has Posted Source Code for the Netflix Player; Hacking Begins

Hack a Day discovered that Roku has posted the source code for the Netflix Player:

Certain components of the software included with the Netflix Player by Roku are subject to separate license terms, including "free" or "open source" software ("Separately Licensed Code"). As required by the terms of the relevant Separately Licensed Code licenses, Roku makes the "free" and "open source" code provided under such licenses, and Roku's modifications to such code, available on Roku's website, at no charge.

The source code files referenced on this page have been provided under one or more open source licenses. The source code listed here is complete to the best of Roku's knowledge. If you believe any additional source code files should be provided under the applicable open source license, please contact us at support@roku.com and provide in detail the product or code module in question. Roku, Inc. is committed to meeting the requirements of the open source licenses including the GNU General Public License (GPL) and will make all required source code available on its website.

There is one interesting caveat to rolling your own Player: "This product is protected by certain intellectual property rights of Microsoft Corporation. Use or distribution of such technology outside of this product is prohibited without a license from Microsoft or an authorized Microsoft subsidiary."

It took a bit longer that I expected for the hackers to get into the Linux-based device. Mbaily on the Roku forums figured out how to telnet into the Netflix Player:

nmap showed port 8080 was open;

Code:
$ nmap [IP]

telnetted to 8080, but no response.

used nmaps scan version flag to yell at the socket with random version detection stuff and got:

Code:
$ nmap -sV -p8080 [IP]

Starting Nmap 4.53 ( http://insecure.org ) at 2008-06-12 14:45 PDT
Interesting ports on [IP]:
PORT STATE SERVICE VERSION
8080/tcp open http-proxy?
1 service unrecognized despite returning data. If you know the service/version, please submit the following fingerprint at http://www.insecure.org/cgi-bin/servicefp-submit.cgi :
SF-Port8080-TCP:V=4.53%I=7%D=6/12%Time=485198E6%P=i686-pc-linux-gnu%r(NULL
SF:,89,"Welcome\x20to\x20the\x20Frampton\x20Debug\x20Terminal\.\n\rType\x2
SF:0'help'\x20for\x20help\.\n\rESN\x20

[TRUNCATED TO OBSCURE MAC ADDRESSES/SERIAL]

Service detection performed. Please report any incorrect results at http://insecure.org/nmap/submit/ .
Nmap done: 1 IP address (1 host up) scanned in 131.096 seconds

I was then able to telnet to the ip port 8080 and get to that terminal from then on. I'm not sure why this enabled the debug terminal, but I'm guessing nmap must have sent some bits to it that switched it on.

Thanks to David for sending this in.

More Reports That Roku's Netflix Player Will Add Additional Content Providers

Forbes reviews Roku's Netflix Player, Netflix's Online Movie Dreams.

The company, in which Los Gatos, Calif.-based Netflix owns a minority stake, says it sold out its first shipment in three weeks. To keep up with demand, Roku has ramped up production in its factory in Asia and is air-freighting units to the U.S., says Tim Twerdahl, Roku's vice president of consumer products.

Twerdahl wouldn't disclose sales figures, but he says Roku calculated initial shipments based on sales of competing digital delivery products such as Apple TV and Vudu. Twerdahl also says the Roku player won't be limited to Netflix. Later this year, a simple software update will allow the box to stream content from other "big name" providers.

Adding Hulu programming could enable a lot of people to cancel cable TV, which is much more expensive than the $99 Roku box and the $8.99 Netflix plan with unlimited Watch Instantly.

While Forbes got a lot of buzz today (slow news week?) for the "scoop" that Roku was adding additional content providers, HotHardware deserves credit for an interview with Tim Twerdahl on May 29th where he first mentioned the possibility of additional partners, and HackingNetflix covered it on June 5th in Roku's Netflix Player To Add Hulu or YouTube Content?

Needham Upgrades NFLX; Underestimated Value of Company

Barron's reports that Needham has upgraded Netflix:

Needham’s Charlie Wolf this morning raised his rating on Netflix (NFLX) to Hold from Under Perform, and lifted his price target on the Web-based video rental company to $25 from $22. Wolf said he has revised his model of the company’s business, and that his previous model “materially under-estimated the value of the company.” His previous model assumed the profitability of a subscriber was independent of how long someone has been a customer; but now he says that “the profitability of a subscriber increases with the length of time he maintains his subscription.”

New Netflix PO Box in Asheville, NC

Bryan reports that there is a new Netflix shipping center or (more likely) drop location in Asheville, North Carolina. Netflix uses a network of more than 50 shipping centers and drop points to provide one-day service to 95% of customers.

Blockbuster Walks Away From Circuit City

Blockbuster issued a press release to announce that they have withdrawn the offer to purchase Circuit City.

"Based on market conditions and the completion of our initial due diligence process, we have determined that it is not in the best interest of Blockbuster's shareholders to proceed with an acquisition of Circuit City," said Jim Keyes, Blockbuster Chairman and CEO. "We continue to believe in the strategic merits of a consumer retail proposition that would bring media content and electronic devices together under one brand. We will pursue this strategy through our Blockbuster stores as a way to diversify the business and better serve the entertainment retail segment."