Xbox 360 & Netflix Team Up in Streaming Deal

(MoneyWatch)  Deals are a dime a dozen in the new media world, but every now and then, one comes along that seems to provide a window on the future. Today's announcement that Microsoft will team up with Netflix to allow subscribers to stream 10,000 movies and TV shows via their Xbox consoles for viewing on monitors may be one of those.

"This generation of consoles will change the face of home entertainment more than any other generation before," John Schappert, corporate vice president of Microsoft's interactive entertainment division, told the Associated Press. That may be nothing more than typical press-release hyperbole, but there are other aspects of this partnership that intrigue me.

One is how Netflix is preparing for the eventual transition of its innovative "DVD-by-mail" rental business into a video-downloading subscription model. We are living through a period of hyper-change, where what was really a game-changer (the original Netflix model) just a few years ago can already envision a declining market just a few cycles out.

By teaming up, Microsoft and Netflix are essentially taking on Apple, which developed its own downloading service for movies and TV programs last year. The Xbox 360's high graphics quality, which gamers say provides a more immersive gaming experience, will easily prove to be a much better better movie-viewing platform than computer screens.

Who knows which partnerships will finally claim the all-purpose home-entertainment hub sweepstakes that enthusiasts have been predicting for a decade or more. This one probably has as good a chance as any.

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