Filed under: Products and services, Launches, Competitive strategy, Amazon.com (AMZN), Netflix, Inc. (NFLX)

Many home TVs now have five or six boxes on top of them: Television cable boxes, DVRs, satellite dish devices and perhaps an Unbox from Amazon (NASDAQ: AMZN). NetFlix (NASDAQ: NFLX) wants to add to that gadget explosion.

NetFlix already has 8.2 million subscribers, so it does have a built-in base that many competitors don’t. Its new device will only cost $99 and will give instant access to a large list of titles. According to The News York Times, the new system “will allow customers to play thousands of movies and shows on their TVs instantly, for no charge beyond their normal subscription fee.”

While it is impossible to handicap the success of these products, the NetFlix offering might do well. For starters, very few competitors start with big pools of customers who are already buying products from them. In addition, the box is remarkably cheap. While the selection of titles is not special, the cost of playing them is modest because there’s no fee beyond the standard NetFlix subscription fee.

NetFlix still has to deal with the problem that the number of wires into the Television is way too massive.

Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.

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This entry was posted on Tuesday, May 20th, 2008 at 2:53 pm and is filed under Companies Competitive Strategy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.