Netflix TV Boxes Coming Soon + Netflix via Gaming Consoles

Netflix LG InterfaceThe big news today is that Netflix and LG plan to market an LG-branded device (like a cable box) that will allow you to watch movies on your TV via Netflix streaming. Details are sketchy, but the product is to be available in the second half of this year.

And multiple sources are claiming that this magical device will play both Blu-ray and HD DVD discs, the two big next generation high definition rival formats that are incompatible with each other. LG already offers a Blu-ray / HD DVD combo player for $799, but some are hoping this new Netflix device will be priced much lower.

The idea, according to Netflix CEO Reed Hastings, is for the new service to combine the benefits of an Internet browser with the luxury of watching movies and TV shows on large, high-definition TV screens. He mentioned that you, as a Netflix subscriber, would be able to go to the Netflix website and create lists of movies you want to see on your TV. Here’s more of what Hastings had to say:

“We think we have solved the real fundamental problem, which has been that choosing movies on a television has been extremely challenging… Video-on-demand companies worked at it for a long time, but choosing movies on the TV just doesn’t have the power of the Web.”

Netflix already has streaming movies available at no additional cost to subscribers. The streaming service has been available since last year and works by you getting a certain number of hours of free online watching time in addition to whatever DVDs you normally get through the mail. For example, if you pay $17 per month for the 3-at-a-time DVD mailing plan, you’d also get 17 hours of free online watching time. The good news is that the same policy will apply to this new Netflix/LG device, that is, you’ll get 17 hours of free online watching time to be available directly via your TV.

Hastings further explained that the company’s Internet-streaming service has been popular, but mainly among the under-25-years-old group who don’t mind watching movies on their computers (or hooking their computers up to their TVs, like I do). But that approach isn’t going to “get to the whole market.”

And this LG partnership is to be the “first of many” Netflix hopes to announce this year with makers of hardware devices, including videogame consoles, according to some sources (Xbox 360? PS3? Both?). Apparently, for several years, Netflix had a small in-house team working on a prototype Netflix device as kind of a “backup option.” But now so many companies are interested in partnerships that Netflix has shelved plans to make a set-top box under its own brand.

So far Netflix has about 6,000 movies and TV shows available for online streaming, which may seem small compared to the more than 90,000 DVDs in its library. But that number is still on the rise and has doubled since the online service went live a year ago. And it’s still a much larger library than most other video-on-demand services available through cable companies.

See our previous coverage as to why Blockbuster has serious issues and why Netflix is likely the best platform for receiving movie and TV entertainment. Also related, some thoughts on Blu-ray vs. HD DVD.

Additional PR quotes from Netflix & LG:

“We want to be integrated on every Internet-connected device, game system, high-definition DVD player and dedicated Internet set-top box,” said Netflix Founder, Chairman and CEO Reed Hastings. “Eventually, as TVs have wireless connectivity built into them, we’ll integrate right into the television.”

Hastings continues, “Internet to the TV is a huge opportunity. Netflix explored also offering its own Netflix-branded set-top boxes but we concluded that familiar consumer electronics devices from industry leaders like LG Electronics are a better consumer solution for getting the Internet to the TV.”

“Consumers crave compelling and immediate content, and the Netflix online streaming movie feature can provide instant gratification. This alliance underscores LG’s goal of developing smart technologies that deliver flexibility, convenience and control to consumers,” said KI Kwon, President of the Consumer Electronics Division of LG Electronics USA, Inc.

*Update* Erick Schonfeld of TechCrunch thinks “The Netflix Set-Top Box Will be a Hard Sell.” But his argument doesn’t discuss the possibilities of Netflix streaming via gaming consoles.