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Microsoft Announces Xbox Deals with Netflix, NBC/Universal

Microsoft announced two new partnerships on Monday for home entertainment with the Xbox. In the fall, Xbox 360 customers and Netflix subscribers will be able to stream movies as part of their membership. In addition, NBC will be adding TV content to the Xbox Live Marketplace and Universal will be contributing movies.

"A growing library of more than 10,000 movies and TV episodes will be available from Netflix when it launches on Xbox LIVE in late fall, with more choices added over time. Through this agreement, along with the existing Xbox LIVE Marketplace Video Store, Xbox 360 will be home to more movies and TV shows on demand than any other device connected to the TV," Microsoft said.

John Schappert, corporate vice president of Interactive Entertainment LIVE, Software and Services Business at Microsoft made the announcement.

In addition to instantly streaming movies to the TV, Xbox LIVE Gold members can fast-forward, pause and rewind, all using either their Xbox 360 Controller or Media Remote.

At the Microsoft E3 keynote, Mr. Schappert also announced that NBC and Universal are joining the Xbox network. NBC will contribute TV shows such as Monk, The Office and Battlestar Galactica. Universal will contribute movies such as: 12 Monkeys, The Bourne Supremacy, The Mummy and The Chronicles of Riddick.

While the NBC/Universal contribution is notable, the Netflix announcement appears significant. While Apple recently announced that their customers are renting and purchasing 50,000 movies every day, the total number of movie titles is limited to a catalog of 2,000 with only 350 of those in HD. Access to Netflix’s library of 10,000 (streamable) movies would boost that presence significantly.

Why Apple and Netflix have not sought a partnership is not clear. Flexibility in pricing may continue to be a lingering issue between Hollywood and Apple, and that could be preventing Apple from obtaining access to the Neflix licensed movies.

In any case, Microsoft is making strong moves to make its Xbox 360 not only a popular game console but also a social networking and TV/movie entertainment system. Whether Microsoft can also turn the Xbox into a big money making venture remains to be seen.

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