NetFlix has this morning announced its intention to launch a service in the UK to provide streamed movies and other premium content. It is expected to launch in Spain in January and expand into the UK in 'early 2012'. It is setting itself in competition to LOVEFiLM (now owned by Amazon) and other services already operating in the UK.
At present, the business model has invariably been focussed on delivering content by post on DVDs, but as broadband speeds improve and more televisions are 'Internet enabled', it is expected that more and more of us will be consuming digital content online, making such a service an attractive alternative to those offered by Sky+, Virgin Media and BT Vision.
"Netflix is very unlikely to dominate the UK market but it may shake it up. The endless wrangling and delays around the YouView platform contrast strikingly with Netflix?s rapid ascent and now its global rollout. In the short term Netflix may be the catalyst that accelerates the rollout of IP-delivered premium content to UK audiences, but it may not itself be the main beneficiary of that trend."Nick Thomas, Principal Analyst for TV & Digital Media, Informa Telecoms & Media
In the past, many online movie rental services were based on limits or per-rental charges which have also discouraged widespread adoption, whilst DVD rental services have offered a number of options including a subscription with unlimited rentals. NetFlix's plans include a subscription option with unlimited streaming, encouraging users to subscribe.
Of course, streaming high quality cotent requires a reasonable Internet connection, so the service may only be attractive to those living in areas with faster broadband services, leaving those in the most rural areas continuing to rely on DVD rental services instead.