Monday, February 11, 2008

Gear: Netflix Goes Blu

In another knock against HD-DVD, Netflix has decided to exclusively back Blu-ray. Frankly, this makes no sense. I can almost understand the retailer mindset that their shelf space is finite and they'd rather stock their shelves with a product that moves faster. But Netflix operates out of warehouses! Are we really to believe that by not stocking HD-DVDs, they're going to use that space for something else?

On the other hand, you could argue that Netflix is simply trying to hasten the end of the format war. But do they really think their choice is going to be the knock-out blow against HD-DVD? And do they really have that much to gain by ending the format war? On a per-movie-rental basis, they don't make any more money renting hi-def movies. In fact, they probably make less, as the initial purchase price of a hi-def movie is higher than standard DVD.

As a current Netflix subscriber who rents both Blu-ray and HD-DVD movies, I find this quote curious:

"From the Netflix perspective, focusing on one format will enable us to create the best experience for subscribers," the company said, adding that not many customers order high-def DVDs.

I fail to see how NOT offering the movies that some people might want to rent will create the best experience for their subscribers. Netflix' real power is in their ability to stock and ship anything that you might want to rent. Traditional rental stores can't touch this kind of selection. Now Netflix is actively working to limit the selection of movies they offer? That doesn't make any sense.

I'm going to seriously consider switching to Blockbuster because of this decision. While Blockbuster exclusively stocks Blu-ray in their stores -- where the limited shelf space argument comes into play -- their online/mailing service still offers HD-DVDs in addition to Blu-ray.

UPDATE (2:20pm): Further reading shows that Netflix is planning to phase out HD-DVD by the end of 2008. No need to jump to Blockbuster just yet. By the end of 2008, HD-DVD may be completely dead and this decision by Netflix will be moot.

4 comments:

matt said...

There are rumblings of an xbox 360 blu ray player if HD-DVD ever truly dies. This whole format war is definitely putting me on the fence from buying either when I get my big tv next week.

CorrND said...

I've heard the xbox/blu-ray rumblings too. It'll happen, sooner or later.

I cannot recommend HD-DVD to anyone.

At this point, you gotta go Blu-ray. If I didn't already own an HD-DVD player and many movies, I'd never buy anything from them. But as things are, people are firesaling HD-DVD players and discs left and right. Barnes & Noble just had an HD-DVD sale where I picked up 12 Monkeys and 40 Year Old Virgin for about $12 each, shipped.

That's DVD pricing!

At these prices, I'm going to keep gobbling them up. It's not like they'll suddenly stop playing if the format dies. (If my HD-DVD player dies, that's a whole different matter...) I'm invested in Blu-ray as well, so if (when) that wins, I'm still set.

Indy Steve said...

You wondered what they might offer instead? Supposedly netflix is going to be offering digital downloads for xbox and ps3. So that would allow all those people who used an xbox as their hddvd player to still get something fron netflix... Of course, that is comparing apples to oranges because the downloads won't be hd quality, but at least it won't leave those people in the dark.

http://www.engadget.com/2008/02/11/netflix-coming-to-xbox-360-and-ps3/

Indy Steve said...

Oh yeah, and also per engadget, Best Buy is now officially on the blu-ray bandwagon. Though not exclusively blu-ray, that's the format they're goinng to officially recommend to hd format buyers.