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What the NetfliXbox Numbers Don’t Mention

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Xbox 360Netflix (s NFLX) 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 (s MSFT)?)

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 (s TWC) 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.

8 Responses to “What the NetfliXbox Numbers Don’t Mention”

  1. “Hulu is predominately enjoyed on a laptop”

    Au contraire. We’re experiencing month over month growth in PC to TV cable sales and will launch a new product this month. More and more folks are watching Internet content on their TVs.

  2. The netflix service for XBOX360 Live on Verizon FIOS is outstanding. Always have 4 bars of HD quality, and the upconversion to 1080p rivals OTA, Bluray, and HD-DVD quality on the same 62″ set. Some titles do still have lower quality and compression artifacts, but Netflix has stated they will be updating many titles to HD and most of the problems with artifacts may have been visible on the original source material as well. As subscriptions go up the many titles that are already available (more is added every week) will only rise (again officially stated by Netflix). This policy will only help their bottom line in the long term. I watch Netflix nearly every day on the Instant Watch queue, and even though I order Bluray discs through the mail, I don’t rush to watch them as much as I rush to watch the Instant queue. I have been wishing that they would raise the limit on the Instant Queue to over 500, or possibly allow browsing through the xbox application to find unique content on a whim.

    On the XBOX front, I bought the live gold service just to have the native Netflix app, but I have found myself purchasing game content through the new xbox experience. I’m by no means a Microsoft shill or fanboy, as I prefer to use Linux daily as an operating system, but the XBox services just keep getting better for me. I’m sure other movie enthusiasts like myself wish only to see more features through Netflix and Native viewing of Hulu/Youtube (HD Please) as well. This type of on demand service is much more convenient than waiting for physical media or “buy/renting” digital downloads.

    I think we’re at the beginning of a game changing business model, and it is now Netflix’s lead to lose. I wouldn’t be surprised if they bought out a Hulu or similar to expand their business model and options.

    Anyhow, love the service. Love the integration with XBox 360. Here’s to Netflix continuing to improve their on demand service.

    Best regards,

  3. idl3mind

    the Netflix service on my TiVo series3 locks up a lot. it’s flawless on my Xbox though. I’ve probably watched over 50 movies (mostly horror, comedies, and indy films) since November ’08

  4. 25 hours per user appears to make the possibility of front-loading and diminished usage less important. I think the novelty would have worn off after one or two movies, not 14 or 15.

    I’m thrilled with Netflix and the streaming service. It works great with my TiVo HD. I’m sure that I will be renting fewer movies (probably just new releases) and spending more time browsing the instant watch queue.

    • Chris Albrecht

      Yeah, but averages are tricky. And we don’t know how many heavy users there are (or how heavily they use the service). I love the Netflix streaming service as well, but after an initial rush of watching I tapered off.