In 2004, everyone was buzzing about how Netflix was going to begin experimenting with movie downloads, even though it seemed like a cumbersome process to convince Hollywood studios to license their movies. A year later, in fact, Netflix told the world that they had put the plan on hold, saying that it was too difficult to work with the movie studios who kept demanding stronger copy protection. Apparently, though, Netflix quietly kept up the work in the background, and are now beginning to roll out an option for some users to immediately stream a small selection of movies. It's streaming, not downloading, which probably helps deal with some of the industry's copy protection worries. It's also using Microsoft's copy protection, which limits what kind of setup you need to have to watch the content (and you'll only be able to watch it on a PC for now). While the company is touting that it's really quick to install the necessary software, the New York Times reporter who tried it found that the install didn't work properly due to conflicts involving Microsoft's DRM technology (surprise, surprise). All in all, it doesn't sound like it's really solved the technical hurdles all of the other poorly implemented movie download sites face -- but it does have one big advantage over all of those sites: no additional fees. If you're a Netflix subscriber, you get a certain allotment of hours which you can stream to your computer at no additional charge. That, alone, may be the point that saves this offering from going completely nowhere. However, the technical limitations are likely to keep the market fairly small for quite some time.
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