Netflix plans to expand outside of the United States, but only with its instant online video streaming. Meanwhile, the company has no plans for a U.S. service that doesn't include DVDs by mail, ReadWriteWeb reports.
Reed Hastings, Netflix's chief executive officer, revealed the plans in a conference call to investors, though he didn't say where the streaming-only service would be introduced. Citing a "tricky" postal system in other parts of the world, Hastings said mailing physical discs would be too difficult, but this gives Netflix a chance to try a streaming-only business model.
As for streaming-only plans in the United States, Hastings said Netflix is "open-minded" to the idea, but there isn't a market for it. "Everybody also wants to get DVDs," said Hastings. "All the new releases are on DVD, the vast catalog is on DVD. When there is demand, it will make sense for us to meet that demand for streaming only."
ReadWriteWeb points out that the lack of demand Hasting cites is an artificial one: Movie studios simply don't offer their new releases through streaming because they don't want to lose the DVD sales. So while Hastings is right people want DVDs so they can rent new releases, the logic doesn't necessarily follow that they're not interested in streaming only.
Even then, I doubt there's no market for that service. Anecdotally, I know people who signed up for Netflix primarily to get instant streaming. But an a-la-carte streaming service would have to be considerably cheaper than one that includes DVDs, because the selection is so inferior. Perhaps at this point, it's better economically for Netflix to require a mail-order plan. That could change if the studios ever loosen up.
