DVD was receiving a big boost today by NetFlix, which is supposed to finally take the last barrier to the widespread adoption of the DVD platform.
In a press conference organized by “Bender, Goldman & Helper”, Mark Randolph, CEO of a young company called “NetFlix”, unveiled their brand-new rental system on the Internet. Their store can be found at http://www.netflix.com.
NetFlix carries literally every title available and will continue to increase them daily. Currently they have 920 titles available on their site – no adult, though. Delivery in two or three days, keep for seven days, replace the disc and drop it in the mailbox. Return postage is pre-paid. Every DVD can also be purchased at up to 30% discounted in Netflix’s “Like-it-keep-it” program. Netflix maintain their own inventory to makes sure demands can be fulfilled. Since the managers of NetFlix have solid background in mailorder business, and electronic distribution, they are in a good position to make sure the mechanics are in place.

Picking a movie on NetFlix’s website is actually simpler than in a real store. Flicksfinder help searching for the right movies, containing synopsis, cast and crew list and ratings. Reserve a copy before the release date and as soon as the title becomes available it will be shipped out immediately. Streetdates will not be broken, but the titles will be made available at the streetdate, trying to achieve shipment prior to the street date to make sure the disc will arrive on time.
Pricing for NetFlix rental system are very reasonable – actually beating DIVX pricing system. They charge US $4,- for a 7-day rental period. There will be an additional charge of US $2,- for shipping and handling for the first DVD, $1,- for every additional disc, never exceeding $5,- however, with Saturday available at an extra charge.
Adult titles will be carried once government regulations for Internet related adult material is a little more clear. DVD ROM products however will also be included in their line-up in the future. A wide range of DVD related releases, not restricted to actual movies, will be part of NetFlix’s catalog.
Currently NetFlix, a California based company, will only cover the US, excluding Canada, but Canada should be included within the next six months as well. Currently there seems to be noone competing with NetFlix, as the prices are lower and the service is better than any other Internet rental store. Very close relationships to the studios helps making titles available and to receive the backing needed to push DVD to the next level, combined with a very agressive marketing campaign this should be an interesting outset. Still, it has to be seen however, if the weakest link in NetFlix’s operation will remain the limited net accessability. There might still be too many people without Internet connection to make this rental scheme a success. Also the waiting period of two or three days needed to ship the discs across country might be a little too long for many users, I’m afraid, especially if they can go down to the rental store on the corner and rent a movie ad hoc.