Netco to introduce set-top box with Internet connection

Netflix VP of original programming Eric Besner revealed on Friday some of the online rental service’s thinking on the movie download biz, saying Netflix is planning to introduce a proprietary set-top box with an Internet connection that can download movies overnight.

Speaking at an Independent Film & Television Alliance production conference in Beverly Hills, Besner said the business model is still being worked out, but the download service likely would be offered in return for the subscription fee members pay for conventional DVD rentals. Service could launch as early as this year.

Users would add movies they want to watch to their rental queue online as they do now, and those movies would then be downloaded to the boxes overnight rather than shipped through the mail.

He said the set-top box is just one of the Internet plans Netflix is working on.

Entertainment Studios chairman-CEO Byron Allen keynoted the half-day conference, telling indie producers that the shift to digital distribution is giving producers the upper hand for the first time because of the need for content and the ability to connect directly and immediately with viewers.

“This tool of broadband is unlike anything ever before,” said Allen, who has created broadband channels for all of the TV shows he advertises on TV to drive traffic.

Larry Gerbrandt, senior VP and general manager of Nielsen Analytics, said during a panel that iTunes downloads of ABC TV shows have so far added to the audience for those shows rather than stealing viewers away.

On a separate panel, Disney senior VP-general manager of pay TV Dan Cohen said the company clocked 11 million streams in May of the four ABC shows it put online for free as part of a two-month experiment.

Users had to watch short commercials while viewing the ABC shows, but they also could pause and rewind through episodes, something that could give digital a bigger advantage in the coming years from an advertising perspective, Gerbrandt said.

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