AFI BLOG: Media and Technology

The New York Times

Netflix, which pioneered the business of offering DVD movie rentals by mail, is now offering its 8.2 million subscribers an option to watch movies easily on their televisions without involving the post office.

Working with a small Silicon Valley company, Netflix will begin marketing a $99 device on Tuesday that will allow customers to play thousands of movies and shows on their televisions instantly, for no charge beyond their normal subscription fee.

The size of a paperback book, the set-top box is made by Roku, a Saratoga, Calif., start-up known for its Internet music players. Netflix, based in nearby Los Gatos, owns a small stake in the company.

The device’s $99 price — less than half of the cost of an Apple TV — will most likely jolt the emerging market for equipment that brings Internet video to TVs.

But Roku still faces many of the hurdles that have stunted the appeal of previous boxes, including a limited selection of programming and competition from ever-more-sophisticated offerings from cable and satellite companies. In addition, larger companies, including Hewlett-Packard, are expected to offer their own devices in the near future.

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