http://www.videsignline.com/news/208402347

obviously we are entering a “battle of the boxes” era. everyone’s got the same idea – sell consumers a pretty cheap piece of hardware that practically ties them to your movie/media service for sales, rentals, and extras and keeps them away from your competitors’ services. copying the iPod/iTunes model.

i don’t think single function boxes like Netflix/Roku and Vudu will survive this battle – unless they are “free” like cheap cell phones with a multi-year service contract. Netflix could do that. and also offering unique content that you can’t otherwise find for free on the exploding number of ad-supported media web portals.

but the boxes that include another function you really want and must have a piece of hardware for could make it. this would include: (a) games (XBox, PS3, Wii); (b) DVR (TiVo, CATV boxes); (c) HD DVD (PS3); (d) computer “media extenders” (AppleTV, XBox, PS3, TiVo); and maybe HDTV’s (HP’s and Sony’s upcoming internet-enabled models). you get two or three birds with one stone, one purchase.

this is where AppleTV is still weak. i think it needs at least one more function besides media extender, take your pick, to compete successfully. dan’s suggestions to weld it together with the iPhone/Touch, and adding Safari to access all those media web portals might work. then you could also buy special applications for it – like games – from the iTunes AppStore too, opening even more possibilities. and/or it could be melded with a revamped .Mac service, which dan didn’t mention.

that why we are all interested what Steve J. will unveil monday. but i can’t really believe he will do anything that bold, alas.

as to the unbox thing. it too met my criterion of being cheap ( i already have a tivo) but the web interface was awful and the selection pitiful when i tried it about 6 months ago. picture quality was nice though.and i didn’t like the auto exploding media situation. if i pay to rent something i don’t want it erasing itself when i don’t finish it quickly enough.

well, we’ll see how many Roku’s actually get purchased. it’s fair to expect Netflix to upgrade the service later this year, and a second generation Roku box next year. this might be more of an initial ‘beta’ unit, like the 2006 AppleTV was, so Netflix can get its foot in the door with something now, before it is too late. It’s up against not just AppleTV, but the already established XBox, Vudu, and TiVo/Unbox services too, with Sony, Nintendo, and others soon to follow.

Netflix has also indicated a willingness to license its service to other hardware systems, and in particular has cozied up to Microsoft and Silverlight. well, there’s always Blockbuster.

ok. i’ll give the contrarian opinion here. i think it’s cool and i’m going to get one.

1) i already have netflix so there’s no additional cost.
2) i don’t mind that it has a minimal gui and depends on t the netflix website. it’s a great website and very easy to navigate.
3) sd is good enough for me. i only have a 27″ screen and it has to look better than many of my cable channels.
4) it’s small
5) it’s made by roku and they have a good reputation for quality and the reviews seem to all admit that it functions as advertised
6) i can easily program my unified remote to do all the limited netflix functions
7) i mostly subscribe to netflix for the foreign and obscure movies that aren’t available otherwise. i checked “watch instantly” listings and there is definitely some ok stuff. the offerings are bound to increase over time.
8) did i mention that it’s cheap? $100 and no service fees. come on… this is an impulse purchase for many people.

a couple of other things:

no hard drive means smaller size, less electricity and less noise. it also means that the content owners aren’going to be stressing about users hacking the encryption on the stored files which should give netflix an advantage when negotiating for usage. also, if you can’t depend on your broadband connection to consistantly deliver enough bandwidth for stutter free streaming then you really should complain to your service provider or fix your home network. i don’t see that as a design flaw of this box.

i hate the windows media drm crap as much as anyone but this thing isn’t a computer so as long as i can watch my show i don’t really care. it’s pointless anyhow because if i want to record the programs all i really have to do is send the roku’s output to a dvd recorder and it will probably capture fine. i doubt i’ll bother though.

what they all have in common is their business model – they are all supported by advertising somehow, just like radio and broadcast TV have been for the last 80 years. and just like Google is now.

you know, i think probably this old way – ads – will prove to still be the best way and ultimately take over the industry. there always will be a niche for focused subscription and pay-per-view products, like first run movies. but hey, generally i prefer “free” (we all grow up being inured to the commercials), and so does 90+% of everyone else.

if that proves true, AppleTV will have to adapt or be pigeonholed as a niche product. and all it needs to adapt is a browser, which Dan recommended in the last article.

Especially with news stories of Time Warner testing paying per-GB of downloads, and Comcast having a “blascklist” of customers who are bandwidth hogs.

Anyone who thinks they would be getting lots of “free” content just by having one of these boxes and a netflix account will be iin for a rude awakening.

I’m also surprised by some of the comments on AI, regarding wanting Apple to make deals which would allow Hulu’s content-streams to play over AppleTV… as if NBC didn’t expressly intend for Hulu to weaken Apple’s influence over pricing for video downloads & rentals.

Why would Apple want to assist a competitor’s product in gaining market-share?

Dan is being reserved this time. i can’t see a single reason anyone would buy one of these. and i’m a regular Netflix user.

the fatal flaw of the Roku unit is the lack of any hard drive, even a small one just big enough to preload a single movie, so that PQ would not have to be limited by the consumer’s internet connection speed (most have a medium service at best). that just ruins it.

and the movie studios will never allow Netflix to offer recent popular movies and TV shows without an additional per-showing rental charge, just like AppleTV and all the rest must do now. so the ‘free’ (no extra charge) Netflix offerings will always be limited, just like the ‘free’ On-Demand stuff cable TV providers offer is too.

This is certainly no ‘AppleTV killer’ as suggested by various technology blog idiots in advance of its actual release.