What the NetfliXbox Numbers Don’t Mention

Xbox 360Netflix announced today that 1 million Xbox users have downloaded and activated the Netflix streaming service since its launch on the game platform in November, and in less than three months more than 1.5 billion minutes of content was watched.

First, let’s take a moment to be impressed. We knew from Netflix CEO Reed Hastings’ earlier statement that “millions” of people were watching streaming video through Netflix, now we know where at least a chunk of those users came from. Those 1.5 billion minutes work out to 25 hours per person. While I’ve read reports comparing this to Hulu, I’m not sure that’s fair. Hulu is predominately enjoyed on a laptop, which is a much different experience than settling into your couch and watching on the big screen.

These NetfliXbox numbers are impressive, but also incomplete. We don’t know how sustained the use of streaming was over those three months. How many of those minutes were front-loaded as people enjoyed the novelty of the service, but then tapered off once they realized there wasn’t that much to watch, or how cruddy the quality can be? Or vice versa, did the number start out small and grow over time as people got more into the service?

Also, how many new Netflix subscribers did the Xbox generate? It seems like there would be a lot of existing overlap between the two tech-friendly services. Wedbush Morgan analyst Michael Patcher predicted that Xbox could yield an additional one million Netflix subscribers this year. (The companion stat question for this is, how many Xbox Live Gold membership subscriptions did the presence of Netflix generate for Microsoft?)

A broader point to consider is that 1.5 billion minutes of video is a lot of bits traveling through data pipes. While companies we’ve talked to have not been concerned about bandwidth caps, cable companies like Time Warner are expanding their metered broadband access. Stacey over at GigaOM has put together an awesome chart illustrating how you might be affected. This is especially important to watch as Netflix expands its HD streaming.

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