How Long Can the Xbox 360 Hold Netflix?

By  |  Tuesday, August 11, 2009 at 6:23 pm

netflix2A big hoopla was made in the games and tech blogosphere today when Microsoft bragged about its exclusive partnership with Netflix. The agreement brings streaming Netflix movies to the Xbox 360, and not to competing consoles. (Of course there are still plenty of other non-gaming options.)

As Crispy Gamer’s Kyle Orland points out, this exclusivity has been known about ever since the partnership began last summer. In other words, today’s reports messed up. (And for the record, I previously overlooked the deal when asking if the Playstation 3 would ever get Netflix support.)

Nonetheless, I think the question of how long Microsoft will hang on to this partnership is perfectly valid. Microsoft has stayed quiet on that matter, fitting with consumer tech companies’ natural secretiveness about exclusive deals. Understandably, the company doesn’t want people glancing at their watches. If you’re on the fence about which console to buy, and Netflix support is a major consideration, you’d obviously be less concerned if you knew when, if ever, the service would migrate to all consoles.

So you have to wonder who stands to gain the most from the partnership. The advantage for Microsoft is intangible. It’s essentially a selling point for the console, but there’s no way to tell exactly how well this is working. For Netflix, the Xbox 360 is another set-top delivery box, but it’s a big one. In February, Netflix and Microsoft said 1 million people had signed up for a free Netflix trial over the Xbox 360, potentially translating to a lot of new customers.

On the other hand, Netflix is missing out on the opportunity to be on the Wii and the Playstation 3. I’m not privy to the details of the agreement, but as all the consoles get bigger install bases, Microsoft will find it harder to keep Netflix by its side unless it threatens to pull support, which I doubt will happen.

We don’t know specifically how long the deal between Netflix and Microsoft will last, but when the contract expires, I expect Netflix to cozy up to the Xbox 360′s competition.

 
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6 Comments For This Post

  1. DaveZatz Says:

    The exclusivity was mentioned in Microsoft’s original press release announcing Netflix. At the time, I assume it was indefinite. Over the last year, I’ve come to suspect it’s a finite amount of time. Of course, that could be or could have been renegotiated. But today’s hooplah on Engadget and elsewhere pointing to the language doesn’t do anything to clear up the situation in my eyes. We know no more, no less than we did a week ago. Hm. (We do know Netlifx has brought up Wii and PS3 in surveys and was looking to hire someone for this space. But what if the survey data was lame or if MS offered to pay to extend the exclusivity.)

  2. ConsiderThis Says:

    The Wii lacks necessary video codecs and hw; not to mention it outputs at 480i/p. The PS3; also does not have stellar native video capablities.

    Look, Netflix has consoles, TVs, other STB (Roku) – they are flooding the channels. If they don’t get to a PS3 consumer they can get to his TV (Vizio/LG/etc).

    Think about it.

  3. Mike Cerm Says:

    I don’t think that Microsoft will ever lose exclusivity, but not because Microsoft is so determined to have it. It’s just not in Sony’s or Nintendo’s nature to make the kind of partnership that would bring Netflix to the PS3.

    Additionally, Sony’s whole philosophy with the PS3 was to establish Blu-ray as the successor to the DVD. Netflix would undercut that effort, and with all the money Sony’s losing on the PS3, they’re not about to undercut the Blu-ray market.

    The Wii is just a joke. It currently has no media playback features, because Nintendo views it strictly as a gaming device, which is hilarious, because it has the weakest game library by far. The whole concept of Netflix-integration is just not something that Wii owners would even understand. I doubt there are many luddites and 12-year old kids with Netflix subscriptions, who are clamoring for a way to stream Netflix movies to their non-HDTVs.

  4. greenbudman Says:

    Hard to understand why Microsoft would make such a big deal out of something thats not. Has anyone every had Netflix streaming? The last time I had it the movie selection was less than stellar, only old movie I either never wanted to watch again or ones I had never heard of. Anyway,the PS3 is a very nice media server and theres a little program out there called Playon that will stream Netflix, Hulu, and even youtube very nicely to your television.

  5. Dave Zatz Says:

    ConsiderThis, The PS3 is actually a quite capable video player.

  6. graig Says:

    so microsoft lost the disk format blueray sorta won. but now netflix is streaming videos in high def. so mabey blueray isn’t winning, mabey netflix is.

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