Studios Shun Netflix, No Downloads

NetflixNetflix has run into the studio brick wall. At this point the studios have very little incentive to move their media via third-party download: DVD sales are a huge cash cow and they own existing services Movielink and CinemaNow. I imagine both Netflix’s rumored player and their partnership with TiVo are indefinitely on hold. At least Netflix is in good company – based on the missing movie downloads, we can assume Apple is experiencing similar frustrations.

Reuters says: Netflix Inc. will postpone a test launch of its online movie download service indefinitely because of problems obtaining licensing agreements from Hollywood studios, Chief Executive Reed Hastings told analysts on a conference call on Wednesday. Hastings said the company would continue enhancing its infrastructure and developing technology to deliver online movies so the service “will be ready to launch when the content climate begins to thaw.”

Update: You can find the conference call audio here. Be sure to listen in about 1:22:15 – when asked about TiVo they respond, “no work going on,” “no content,” and “no point.” Ouch! Well it’s safe to say this deal is dead. Once the studios join us in the digital revolution, they’ll beef up their own services and partner with large stable companies that have a proven track record (sounds like Apple).

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