Netflix Mulls Streaming-Only Service - Source
24 2월 2009 - 5:55AM
Dow Jones News
Netflix Inc. (NFLX) is "looking at the possibility" of letting
customers get their videos delivered to them only over the
Internet, according to a person familiar with the company's
plans.
To that end, the Los Gatos, Calif.-based company recently
surveyed subscribers about spending $9.99 a month for an Internet
streaming-only service, the person said.
The moves are the most brazen yet from Netflix to break its 10
million subscribers of their DVD viewing habits now that faster
Internet connections make watching Internet videos much more
palatable.
Netflix benefits because a significant portion of its operating
expenses go towards delivering DVDs, and its profit margin can
swing wildly because of an increase in postal rates. Meanwhile,
it's increasingly competing with Apple Inc.'s (AAPL) iTunes and
other Internet video providers.
It's ongoing focus on Internet delivery means "Netflix controls
its own destiny," Wedbush Morgan Securities analyst Edward Woo
noted in late January, after Netflix reported fourth-quarter
profits and subscriber gains above expectations.
But at the same time, there's a large initial investment - about
$75 million in 2008, and another $100 million in 2009- required to
build up the necessary IT infrastructure.
Netflix shares are down 3.4% at $35.55.
-By Ben Charny; Dow Jones Newswires; 415-765-8230;
ben.charny@dowjones.com