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Netflix Truly Threatened by Warner Bros. Service?

Posted by on March 8, 2011 at 3:16 PM EST

netflixIs Netflix threatened by the new streaming service Warner Bros. released?

Warner Bros. recent announcement that they will be streaming rentals on Facebook has stock speculators worried, as Netflix stocks have been affected. Warner Bros is currently offering The Dark Knight on Facebook at $3 for 48 hour rentals.

According to Warner Bros. president Thomas Gewecke, “Facebook has become a daily destination for hundreds of millions of people…Making our films available through Facebook is a natural extension of our digital distribution efforts. It gives consumers a simple, convenient way to access and enjoy our films through the world’s largest social network.” Does Netflix need to worry?

While Warner Bros have said that The Dark Knight rental is only a “test,” it doesn’t seem like they are offering it at a reasonable price. $3 for a rental is awfully expensive, especially when The Dark Knight has been available on DVD for a long time now.

Netflix, on the other hand, offers subscriptions at only $7.99 per month, which includes unlimited video streaming of thousands of titles on various devices, including the Wii, PS3, and Xbox 360. When you compare “unlimited” streaming with a 48-hour rental, it’s clear that Netflix makes more sense.

However, the people who are dumb enough to buy Facebook credits (which can be spent on virtual goods) are surely dumb enough to rent a movie for $3 a pop, so maybe the folks at Warner Bros. are onto something here.



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