Netflix to Back Blu-ray Format

BEVERLY HILLS, February 11: In another blow to supporters of
the HD DVD format developed by Toshiba, online movie rental service Netflix
announced that it will move toward stocking high-definition DVDs exclusively in
Sony’s Blu-ray format.

Since the first high-definition DVDs came on the market in
early 2006, Netflix has carried both formats. However, citing the decision by
four of the six major movie studios to publish high-definition DVD titles only
in the Blu-ray format, Netflix will, as of now, purchase only Blu-ray discs and
will phase out the alternative high-definition format, HD DVD, by roughly
year's end. While only a portion of Netflix subscribers have elected to receive
high-definition DVDs, a majority of those subscribers have chosen Blu-ray over
HD DVD. As part of the transition to Blu-ray, Netflix will acquire no new HD
DVDs, with its current HD DVD inventory continuing to be offered up for rent
until the discs' natural life cycle takes them out of circulation in the coming
months.

Netflix currently stocks more than 400 Blu-ray titles,
having recently added popular releases such as Across the Universe (Sony), Gone Baby Gone (Buena Vista) and the Academy Award-nominated Michael
Clayton (Warner Bros.). Blu-ray titles
scheduled for release in the next month or so include the Academy
Award-nominated No Country for Old Men (Walt Disney), Walk Hard: The Dewey Cox Story (Sony) and Alvin and the Chipmunks (20th Century Fox).

Netflix’s pledge to exclusively back Sony’s Blu-ray format
follows Warner Home Video’s announcement last month that by the end of this
year, it will release high-definition titles exclusively in the Blu-ray format.
Warner joined fellow majors Sony Pictures Home Entertainment, Twentieth Century
Fox Home Entertainment and Buena Vista Home Entertainment in endorsing Blu-ray.
Currently, the two remaining majors—Paramount Home Entertainment and
Universal Studios Home Entertainment—publish in the HD DVD format.

"The prolonged period of competition between two
formats has prevented clear communication to the consumer regarding the
richness of the high-def experience versus standard definition," said Ted
Sarandos, the chief content officer for Netflix. "We're now at the point
where the industry can pursue the migration to a single format, bring clarity
to the consumer and accelerate the adoption of high-def. Going forward, we expect that all of
the studios will publish in the Blu-ray format and that the price points of high-def
DVD players will come down significantly. These factors could well lead to
another decade of disc-based movie watching as the consumer's preferred
means."

Continued Sarandos, “From the Netflix perspective, focusing
on one format will enable us to create the best experience for subscribers who
want high-definition to be an important part of how they enjoy our service.”

—By Irene Lew