Netflix partners with LG to stream to TV

By Ned Randolph -- Video Business, 1/3/2008

JAN. 3 | Netflix is teaming with LG Electronics on a set-top box that streams movies and other programming from the Internet to the TV.

The deal comes after Netflix tested various, potentially proprietary set-top box services with focus groups over the past year, and it is the first of what Netflix plans to be many partnership deals with set-top box manufacturers.

“We’re not developing our own device,” Netflix spokesman Steve Swasey said. “Rather than one Netflix-branded box, we’d like to be in 100 boxes developed by great manufacturers. LG is one of many to come.”

The set-top box concept is an extension of Netflix’s instant viewing feature Watch Now, which is limited to about 6,000 movies and TV titles, as opposed to the more than 90,000 titles the company offers for rental on DVD.

Watch Now allows Netflix’s 7 million subscribers to watch movies streamed from the Netflix Web site based on a tiered level of service that corresponds to their membership level. The new box will stream movies from the Internet to a high-definition TV.

Netflix has not offered specifics on how the box will function, such as whether a PC will be required or if users can browse the Netflix library through the set-top box.

“Internet to the TV is a huge opportunity,” said Netflix founder, chairman and CEO Reed Hastings. “Netflix also explored offering its own Netflix-branded set-top boxes, but we concluded that familiar consumer electronics devices from industry leaders like LG Electronics are a better consumer solution for getting to the TV.”

In related news, Anthony Wood, who was hired in early 2007 as Netflix’s first VP of Internet TV, will leave now that Netflix has opted to partner with manufacturers on the set-top box initiative rather than develop its own.

“He was really instrumental in getting us to this point in where we are,” said Swasey.

Wood, who was the founder of Replay TV, will return to Roku, a device company he founded.

Connecting the Internet to the TV has been an increasing focus of movie download companies, although few have managed to catch on. Apple TV is a box that plays iTunes movie, music and TV files on the TV. Last year, TiVo partnered with Amazon.com’s Unbox to deliver Internet movie downloads to the TV. CinemaNow earlier this week announced a deal with Macrovision to standardize a middleware technology to download CinemaNow movies onto consumer electronic devices and share them with other devices such as digital TV on a home network.

Netflix, which has no plans to abandon its subscription model, said the deal advances its goal of making electronic delivery—including future high-definition content—an enhancement to the Netflix subscriber experience.