Netflix video streaming coming to Wii

Another step forward towards Netflix getting its streaming service on living room TV's

One of the problems Netflix has been trying to solve is getting its streamed videos onto living room televisions.  On Wednesday, the company announced a partnership with Nintendo to bring its services to the Wii video gaming console, taking a step further into getting streamed videos on our TV's.  

It's a good move for Netflix in that the Nintendo Wii is the top selling video game console in the US.  Just this past Decemeber, the company sold over 3 million Wii's here in the US alone, and in total about a 26 million install base in the US.  Nintendo said, according to its research 86 percent of all US Wii consoles are located in the living room.

For Netflix, this is an opportunity to gain more subscribers as the ease of streaming movies on living room televisions could be appealing to Wii owners.  But at the same time, Netflix doesn't quite offer an excellent selection of titles for its streaming service.  I use it all the time to view OLDER titles, although was recently surprised to find Benicio Del Toro's "Che" available for streaming the other day, a relatively new movie.  

Interestingly, Netflix recently announced a deal with Warner Bros. that would delay renting new release DVD's until 28 days after they are released in retail stores, to hopefully increase DVD sales in this shaky economy.  In return, Warner Bros. would make more titles available for streaming to Netflix customers, thus increasing Netflix's streaming library and perhaps add to the appeal for Wii owners to sign up.

How will it work on the Wii?  Netflix said subscribers who own a Wii will need a special instant-streaming disc, which would be available at no extra cost.  The disc operates like a Wii game and would give access to a Netflix interface where users can pick and watch what's available.  Another given requirement will be a broadband Internet connection, of course.   Netflix said we should expect to see these features by the Spring of 2010.

Netflix is already available on the XBox 360 and Sony PS3 where it functions in a similar manner to this new deal with Nintendo, although the 360 doesn't require a disc.  One key difference though is Nintendo's Wii does not support high-definition, which is a major downfall.  The 360 and PS3 can run 720P and 1080P videos.  The Wii supports a measly 480P which can tend to look pretty bad on HDTV's.  

“Our goal is to offer Netflix members as many ways as possible to watch movies and TV episodes streamed from Netflix right to their TVs and to give non-members more and compelling reasons to consider the service,” said Netflix co-founder and CEO Reed Hastings. “Joining forces with Nintendo, which has been so immensely popular with consumers since its introduction, is a very meaningful step in that direction.”

In the end, if Netflix can get more and more of its users to stream as opposed to rent DVD's by mail, it could significantly cut its costs.  Reports across the Web estimate it costs Netflix about $0.06 to deliver an SD stream and $0.09 to deliever an HD stream.  In contrast Netflix spends about 78 cents out and back for sending a DVD via physical mail.