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On the surface, Microsoft and Netflix seem like unlikely business partners. Netflix provides a service for home DVD delivery, making them a major force in the entertainment world. Microsoft, on the other hand, is most valuable in the business world, where high-level software is king. However, these two forces in different industries have teamed up to provide live streaming video through the web-enabled Xbox Live game console.

Netflix offers free online streaming for its existing customers already; the service lets users either watch selected Netflix titles on their computers, or hook their laptops up to their televisions. For Xbox users who already have a device connected to their entertainment centers, Netflix’s “Watch Instantly” feature is a very convenient way to access on-demand movies. More than 10,000 DVDs and counting are available through Netflix, and the company promises to add additional films over itme.

A Netflix press release claims, “Through this agreement, along with the existing Xbox LIVE Marketplace Video Store, Xbox 360 will be home to more movies and TV shows on demand than any other device connected to the TV.” Clearly, the two companies are taking aim at rivals like Apple TV, a set-top box that allows users to access web videos through their TV sets. However, the Xbox deal might conflict with Roku’s Netflix Player box, which also gives subscribers a PC-free way to watch streamed titles. For the price of a $99 set-top box and a monthly Netflix subscription of at least $8.99, Roku is offering yet another alternative to Apple TV.

Xbox also hopes to compete with rivals in the live streaming industry. Sony’s popular Playstation 3 console features a built-in Blu-Ray player, a format pioneered by Sony itself. The dynamic high-definition format has beat out HD-DVD, and Playstation owners are taking advantage of the special interactive features included on Blu-Ray discs. It seems that by partnering with Netflix, Microsoft hopes to promote Xbox as more than simply a game console. Xbox may become a launching point for Microsoft’s forays into music and video content, something at which rival Apple has excelled.

With reports circulating that the slumping economy has not slowed down either home DVD rentals or video gaming, Netflix and Xbox could turn out to be a deadly duo.

Wednesday, July 30th, 2008 You can skip to the end and leave a response. Pinging is currently not allowed.

By Haley January Eckels