Earnings were solid but the DVD rental site’s lower profit forecast, due to the cost of shifting to downloads and Blu-ray, sends shareholders scurrying

BusinessWeek reports that the once thriving Netflix may be in for a bit of a bumpy road ahead.

It has been a good year for Netflix shareholders, until now that is. After riding a 50% spike in the DVD-by-mail company’s shares, investors fled in droves on a first-quarter report that showed record sales and profits, but warned of slowing growth and higher costs.

Netflix had found a nice increase in subscribers after the recent rising of Blockbuster rates and ended the first quarter with 8.2 million subscribers, a 21% surge from the prior year.  However, with increasing technologies and costs that cut into profit margins, the company is treading ahead with careful footing aware that profits are clearly still under pressure.

While higher prices on Blu-ray rentals might scare some customers away, the effect on overall growth may be minimal. Analyst Jim Friedland of Cowen & Co. (COWN) pointed out in a research note published Apr. 22, “Blu-ray subscribers account for a low single-digit percentage of subscribers.”

In terms of movie downloads—currently offered free for PC viewing to existing subscribers—Netflix has nearly doubled the selection of titles from 5,000 at the end of 2007, to roughly 9,000 now. This rapid expansion means that costs to build-out the online channel are rising, Friedland says. “Netflix indicated that it eventually plans to charge for its online instant viewing service, but we expect it to remain free until the number of digital titles increases and a number of Netflix-to-TV devices become available,” he wrote. Netflix plans to release a set-top box made by South Korea’s LG Electronics later this year, and similar partnerships with other consumer electronics companies are expected.

 

Tags: blockbuster, blu-ray, dvd, movie, netflix, rentals

Retailers Embrace Innovative Product as Best Way to Watch Movies at Home

 

SANTA CLARA, Calif., April 22 /PRNewswire/ — VUDU Inc., the company that brings instant access to video-entertainment to the living room, today announced that it has been named the “Best Product: Digital Home” at the RetailVision Spring 2008 Event — the premier global event for the retail consumer channel. VUDU also participated in the first FRESH product showcase event held during RetailVision where select companies presented their product to over 200 Top Level Retailers, eTailers, and Direct Marketers.

“VUDU is truly honored to receive the Best Product for the Digital Home category,” said Patrick Cosson, vice president of marketing, VUDU. “We believe it is a testament to the innovative product and entertainment experience we have developed and exemplifies the close relationships we are building with the retail channel.”

The winners of the “Best of RetailVision Awards” are selected by decision-makers from Top Level merchants, who are responsible for selecting products and services to be offered to the consumer market. VUDU won this prestigious “people’s choice” award in a secret ballot of the attendees during the exclusive two day event in Orlando, FL, April 15-16th, 2008.

“The Digital Home Award represents the best of the consumer tech products currently on the market and are chosen by the retailers themselves, the ones who shape the market,” said Ray Robidoux, Sightline Group, a leading retail channel consulting firm. “I believe companies such as VUDU, who were so well received by the retail community at this year’s show, have a promising future.”

VUDU gives movie and TV fans the ultimate in flexibility and choice. Users can finally watch the right movie at the right time, instantly — no planning needed, no computer required, no cable TV or satellite service necessary.

    

About VUDU:
VUDU is dedicated to bringing instant access to video entertainment to every living room. Through relationships with every major US motion picture studio and more than 25 independent and international distributors, VUDU delivers thousands of mainstream movies, HD films and TV shows straight to the television. Consumers can finally watch what they want, when they want-no planning needed, no computer required, no cable TV or satellite service necessary.

Tags: digital, entertainment, home, Movies, vudu

The ever beautiful Jennifer Aniston seems to be getting a great deal of attention during her time in Miami shooting for her upcoming film Marley and Me.  It appears she She one of the very best from her itsy bitsy teeny weenie bikini collection so she could soak up a few rays during some down time.  
Tags: bikini, jennifer aniston, marley and me, miami