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Netflix to introduce streaming-only service -- but not in the US

Netflix have announced their intention to launch a streaming-only video option beginning in the second half of 2010. Currently the only way to stream Netflix movies is to sign up for the DVD-rental-by-mail service. But the new web-only option will only be available outside the US.

Why make a streaming service Netflix' first offering outside the US? 'Tricky' postal systems, says CEO Reed Hastings.

Now, this is a bit of an odd one. Most western nations already have DVD-by-mail systems that work just as well as (or better) than Netflix. So I don't think 'tricky' postal systems are the real reason behind this move. What then do Netflix intend to achieve by focusing on streaming content outside of the US? Is it just a matter of flexibility? More subscription options?

But again, why outside the US? Netflix's brand recognition outside the US is not great.

Hastings and Netflix claim there is still seemingly enough demand for such a service, with 42% of their subscribers watching at least "15 minutes of one TV show or movie in the last quarter." Readwriteweb point to the growing adoption of Hulu and BBC's iPlayer for TV, Pandora and Spotify for music -- but I don't think it's quite the same thing for movies.

People like using their big, wide-screen televisions. They like using their expensive sound set-ups. Set-top boxes that stream content from the Web are still relatively hard to come by and not readily adopted by consumers. Then there's the matter of bandwidth: streaming a movie in high-resolution with a surround-sound audio track is still way beyond the capacity of most American and European Internet connections.

Netflix haven't yet announced which country will get to trial their streaming-movie service, but it'll be interesting to see which one they choose -- and if it will indeed be successful.

[via Readwriteweb]

Tags: dvd, netflix, on demand, OnDemand, streaming, streaming video, StreamingVideo