What's on iTV? NetFlix or MacFlix?

What's on iTV? NetFlix or MacFlix?

Summary: I've been thinking about iTV a lot lately and something occurred to while watching 60 Minutes on Sunday. Apple could use Macworld Expo to announce a partnership with Netflix on the iTV.


I've been thinking about iTV a lot lately and something occurred to while watching 60 Minutes on Sunday. Apple could use Macworld Expo to announce a partnership with Netflix on the iTV.

In a previous piece I asked: iTV: What the heck is it? - and you had plenty of answers (media center, Airport TV, media hub, Internet appliance, etc.). Later I speculated that iPhone was a diversion from the real Macworld Expo show stopper, an upgraded iPod or the mythical iTV.

The mysterious iTV product is an extremely rare breed - an unannounced product that Steve Jobs actually talked about. Clearly iTV will be announced next month, Steve practically told us as much, but he said very little else about the product.

During the 60 Minutes interview with Netflix founder Reed Hastings, Lesley Stahl point blank asked him about downloading and he was carefully vague. But Stahl later said that Netflix's download service would debut in January. January?! The timing is perfect to coincide with MWSF.

While I can definitely see Hastings being introduced by Steve Jobs during his January 9 keynote address, there's another big factor at play here. Netflix is a potentially huge competitor to iTunes. Apple already sells downloadable movies via the iTunes Store so the potential conflict may be too much for Apple to resolve. Do they build, buy or partner for video downloads and streaming?

Apple may think that they can do the video thing on their own due to their success with the music side of the business. So what does Netflix bring to the table? For starters, they have a billing relationship with millions of customers who like to rent movies. Second they have distribution deals in place with all of the major movie studios. Third, they have the a first mover advantage (just ask Blockbuster Online/Total Access).

Apple should partner with Netflix (at least initially) and offer a free three month subscription to NetFlix Online with each iTV sold. Apple would get access to Netflix customers via a limited-time exclusive engagement and Netflix would get access to the frothing Apple customers waiting to snap up the US$300 iTV boxes. Make the movies seemlessly transfer to the iPod and it's a home run.

Perhaps the most telling part of the 60 Minutes segment, was a brief interview with Bruce Eisen, president of CinemaNow:

"But right now, for most people who would go to your site to download a movie, they would have to watch it for the most part, on their computer?" Stahl asks. "Right," Eisen says. "You hit the nail on the head. Using it is easy. Connecting it to the TV where most people do want to watch it isn’t easy yet."

There's your smoking gun kids: the "connecting it the the TV" part which Eisen says "isn't easy yet." iTV could be just the piece of hardware that makes connecting movie downloads to your TV easy.

Movie downloads at a (home) theatre near you?
For Apple it comes down to build vs. partner. Will Apple forge ahead with their own movie downloads (MacFlix)? Or will they partner with someone like NetFlix to stream their movies to iTV?

[poll id=13] 

Topic: Apple

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  • Build *and* partner

    Here's what I want, not necessarilly what I'll get.

    Basic Dot Mac membership: add TiVo services to iTV and one included NetFlix
    download per month.

    Enhanced Dot Mac membership: add TiVo plus normal NetFlix functionality ("check
    out" up to ? (3?) movies with iTS DRM).
  • Purchasing Netflix

    What if Apple were to BUY Netflix? With a 1.95B Market Cap it seems entirely dooable.
    • Why not buy Tivo as well?

      Tivo, with its constant money losses, seems ripe for the plucking. You'd get their installed base, plus their superb UI and remote. Combine that with Netflix and you might have a very powerful product.
      tic swayback
      • You're stealing my thunder

        Tomorrow's piece was going to be about TiVo!
        Can you say iTiVo?


        - Jason
        Jason D. O'Grady
  • It would be foolish to partner with Apple

    Just look at what they did with the clones.
    • Maybe a better example:

      Look at what they're doing to the RIAA, holding them at bay, stifling them from cranking download prices through the roof.

      You're right though--Apple should just outright buy companies like NetFlix or Tivo, not partner with them.
      tic swayback
  • XBOX 360

    Apple is too late to the party. What did you call it? First mover advantage??
    • XBox 360 HD downloads take [b]2 DAYS!![/b]..

      that is a complete an utter failure... when you can walk to Blockbuster watch your (10+ times if you'd like) movie and walk back faster than you can download from xbox 360 movie downloads that is a complete and utter failure.. standard def is 1 day to download...

      if i'm really lazy and don't want to leave my house i can get next day blockbuster delivery to my doorstep in faster time even than that... unless they can get downloads in the 1-2hr range.. max 4 hrs... i'm going to go to the store and rent it... there is not advantage to download it.. and to add insult to injury it costs more to download it..

      i hope iTV is not going to be like the xBox 360 fiasco because that would be REALLY bad for Apples reputation.. MS.. everyone just says... well that's MS....
  • Its all about the features

    I could go either way, MacFlix or NetFlix, but in the end its all about the features.
    I love the idea that .Mac membership will be rolled up in this somehow. I'm
    currently a NetFlix subscriber and if I could download movies faster than it takes
    for them to go through the mail (48 hours where I live) I'd do it.

    I have not yet purchased a movie from iTS however, here are my reasons. Number
    1, I can't burn it to DVD. The movie is locked onto my computers. Now, I've got a
    mini on my living room TV and a mini in my truck, so I'd have more access to my
    movies than most people, but why should I pay DVD prices to download a movie
    that isn't as portable and is lower in video quality? Sure, the iTV will no doubt be
    awesome and it will allow me to take the movie to my theater projector
    downstairs, but what about my portable DVD player for my kids? Or my brother's
    house? I don't have an iPod right now, instead I use my Treo 700p for music and
    video, so the only means I'll have to carry my iTS movies with me is on my
    PowerBook. Number 2, lack of special features. Again, why should I pay DVD
    prices for a product that isn't as fully featured? For the cost of 1 DVD per month I
    get 3 at a time from NetFlix, which ends up being between 7 and 12 movies per
    month, depending on how long I take to watch them before sending them back.

    Now, Apple's got a big opportunity with the iPhone. If they give it Treo-rivaling
    features (OS X lite to run Mail and other OS X apps) I may switch, but if its just an
    iPod with a phone in it I'll stick with my Treo. I'm really hoping they go full-
    blown-smartphone with this thing, but my gut says its going to be a simple
    consumer-friendly iPod based device with a cell phone tacked on.
  • Yeah I talked about this months ago..