Netflix on Your Cable Box?

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Last week we wrote about Comcast developing a video streaming service that some people likened to Netflix. That Comcast and other cable companies may want to do that is pretty obvious—streaming video is killing cable.

Well, killing may be a strong word. In fact, it sounds like major cable companies might just be flirting with Netflix. Some people are naturally drawn to those who are bad for them. Or is this a case of keeping your enemies close.

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Anyway, Reuters is reporting the major cable company execs have been in talks with Netflix about adding the video company’s streaming service onto their set-top-boxes. Is that madness? Maybe, maybe not.

Would NetFlix on a cable STB work the same way as it does on a Blu-ray player, smart TV or Roku (or Apple TV)—essentially an app that needs to be verified through a code that proves you pay for the service? Or would this be a deeper integration, something like a VOD option within the cable company’s own menu?

According to the Reuters story, it may be offered as a feature that the cable company would charge for (and then share the revenue with NetFlix).

On one hand, it sounds like madness. Why would a cable company encourage users to try out a service that could replace much of their video watching? But what if the cable company uses Netflix as its VOD arm? Then the cable company wouldn’t have to spend so much time developing and managing is VOD platform. And what if that cable company also controlled a major TV network and a movie studio… hmm.

The report also suggested that Netflix sees itself as a rival to cable TV channels like HBO. Netflix does now offer some of its own original programming. If a complete integration of Netflix offerings isn’t possible (due to many complicated content licenses) perhaps Netflix original programming could come to cable VOD without the need to actually be a Netflix customer.

A few weeks ago Verizon announced that it will be working on a streaming service with DVD rental company Redbox.

Streaming video over broadband has created a whole new world for content providers, so I expect many tentative moves and trial programs before all the player figure out where they stand in this new territory.

Update: Looks like Comcast doesn’t want any part of Netflix, but what about the other big cable companies?

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