The open letter is signed by Quickflix CEO Stephen Langsford and addressed to Netflix CEO Reed Hastings and the internet community. Langsford asks Netflix to Australia through the front door. He accuses it of ignoring backdoor access to its services, hauling in cash and stepping on Australian rightsholders.
“Netflix not only knowingly collects revenues from subscribers with unauthorised access to your US service, investing nothing in the Australian market nor paying for Australian rights to the content you make available, but also tacitly encourages Australian consumers to inadvertently breach the copyright of the content owners,” he said.
“Unlike yourself, Quickflix has obtained all necessary Australian rights to the content on its platform, faithfully meets all necessary security requirements, including geo-filtering imposed by the content rights holders, and continues to reinvest in its service with the goal of offering the very best service in the market to its customers.”
We have asked Netflix to comment on this, but so far it has not responded.
Langsford made some suggestions to Hastings about getting Netflix’s game in order, starting with a legal launch and a VPN lockdown.
“We challenge Netflix to play by the rules. It’s how we do it here in Australia. Stop turning a blind eye to the VPN services acting as a gateway to your service. Be honest and face up to the issue of unauthorised access to your US service,” he said in his sign off.
“Have the courage to limit your service only to the territories where you have legally obtained the rights to operate by abiding by the geo-filtering obligations required by your content license agreements. And do so immediately.”
The Quickflix CEO said that he looked forward to fair and square competition and the resulting benefits to Australians.
The company said the new functionality makes using Bing more like “having a conversation.”
It lets you ask questions sequentially that build off each other, so you don’t have to keep repeating the topic you’re asking about.
For instance, if you ask Bing, ”Who wrote Dracula”? “Bram Stoker” pops up at the top of the screen. You can then ask, “Where was he born,” and it gives the answer “Dublin, Ireland.”
Microsoft said it answers the questions by combining “conversational understanding” with its database of knowledge about people, places and things.
It comes as Bing’s largest competitor, Google, is working to make its own search engine better at understanding queries in natural language.
Google also has a conversational search mode that works in a similar way, though currently it only works when doing voice searches in Chrome and in Google’s mobile search app.
Bing’s new feature works well, and you can take the questions far. After asking about Bram Stoker “Where was he born,” you can also ask, “When did he die?” Answer: April 20, 1912. Or, “How did he die?” Syphilis. (But, asking simply “how?” did not work as well.)
In Bing, the feature works on the desktop as well as on mobile devices.
Microsoft has worked to make Bing more useful over the years, partly by integrating a wider range of information from outside sources into results. Data from social sites like Twitter and Facebook plays a part in this, as well as data from services like IMDB and Netflix.
Earlier this year Bing expanded its index of the Web to include more information about professionals like doctors, lawyers and real estate.
With nearly 70 percent market share in the U.S., Google is still by far the dominant player in search, according to comScore. Microsoft’s Bing has just under 20 percent share.
But Bing’s new feature could give it a leg up against Google when it comes to search, at least for now.
The announcement of the deal, put together in May, comes as Netflix has been waging a public campaign against such fees, which they present as tolls, and calling on the Federal Communications Commission to review the market.
Having brokered this so-called interconnection agreement, AT&T and Netflix are now working to build out new network connections for Netflix content to be delivered directly to AT&T’s servers “to improve the viewing experience for our mutual subscribers,” the companies’ representatives said.
“We’re now beginning to turn up the connections, a process that should be complete in the coming days,” AT&T spokesman Michael Balmoris said.
This marks the third such agreement Netflix struck with major U.S. Internet service providers in recent months after it revealed similar traffic exchange agreements with Verizon Communications Inc in April and Comcast Corp in February.
Consumers have also complained to the FCC about an ongoing spat between Netflix and major Internet providers, saying they are experiencing slow download speeds for Netflix video.
Both sides accuse each other of causing a slowdown in Internet speeds by the way they route traffic.
Financial terms of such interconnection agreements are secret. The FCC last month moved to privately review the current deals, though did not indicate specific plans to regulate that part of the market.
German monthly Magazine Manager cited people familiar with the matter as saying the talks were far advanced but no deal had been clinched and that Netflix was also in touch with other German telecoms groups.
Netflix in May unveiled plans to launch in both Germany and France this year, in the biggest test so far of its global expansion strategy.
Manager Magazine said Deutsche Telekom was open to accommodate Netflix’s expansion even though the service would compete with the German company’s own web-based TV offering called “Entertain”.
Deutsche Telekom declined to comment.
Netflix, whose internet-based delivery of movies and TV series such as “House of Cards” has disrupted pay-TV markets in the United States and elsewhere, wants to grow its international business to reach new customers and increase its buying clout with content providers.
It is already in more than 40 countries, mostly in Latin America, and has entered Britain, Ireland, the Nordics and the Netherlands in the past two years.
In Germany, it would compete with Amazon’s Prime Instant Video, ProSiebenSat.1′s Maxdome, Sky Deutschland’s Snap and Vivendi’s Watchever.
Germany has the highest number of broadband households in Europe, with 29.1 million in 2013, according to estimates from SNL Kagan.
BlackBerry Ltd has agreed to a licensing deal with Amazon.com Inc that will let the Canadian smartphone maker offer some 240,000 Android applications from Amazon’s app store on its lineup of BlackBerry 10 devices this fall.
The move allows the Waterloo, Ontario-based company to add a vast array of consumer-focused apps to its devices, while at the same time directing its own efforts toward developing enterprise and productivity applications.
Customers who own smartphones powered by its BlackBerry 10 operating system will now be able to access popular Android apps such as Groupon, Netflix, Pinterest, Minecraft and Candy Crush Saga on their BlackBerry devices this fall. Google Inc makes Android, the mobile operating system used in more than a billion phones and tablets.
The apps will become available after the Canadian smartphone maker rolls out the upgraded BlackBerry 10.3 operating system, the company said.
The move is the latest by the smartphone pioneer to streamline its focus as it attempts to reinvent itself under new Chief Executive Officer John Chen as BlackBerry phones have lost ground to Apple Inc’s iPhone and Samsung Electronics Co Ltd’s Galaxy devices.
Analysts saw the move as a step in the right direction, but are not sure whether it will help turn the tide for BlackBerry.
“While this will widen the BB10 app ecosystem, the consumer
smartphone environment still remains challenging,” Wells Fargo analyst Maynard Um said in a note to clients.
Um views the announcement as a positive for BlackBerry, but said “whether it stems consumer churn remains to be seen.”
Chen wants to remain a competitor in the smartphone segment, but is focused on making BlackBerry a dominant force in machine-to-machine communications. The company’s QNX software already is a mainstay in the automotive industry, powering electronic and other systems in a wide range of cars.
BlackBerry already works with hundreds of large enterprise clients, including corporations and government agencies, to manage and secure mobile devices on their internal networks.
Chen intends to build on those ties and BlackBerry’s security credentials to let these enterprise clients build and customize in-house corporate and productivity applications for their employees.
U.S. regulators will review agreements between Netflix, Verizon, Comcast and other content and Internet providers to determine whether they are causing slow web download speeds for some consumers, especially for streaming video content.
Consumers have complained to the Federal Communications Commission about the ongoing spat between Netflix and Internet service providers (ISPs). Both sides accuse each other of causing a slowdown in Internet speeds by the way they route traffic.
“At the heart of this is whether ISPs that provide connectivity in the final mile to the home can advantage or disadvantage content providers, and therefore advantage or disadvantage consumers,” FCC Chairman Tom Wheeler said on Friday.
Large content providers such as Netflix Inc have historically paid middlemen or ISPs to deliver their content to consumers. The specifics of such agreements, known as “interconnection” and sometimes “peering,” have been secret and outside of the FCC’s regulatory scope.
The FCC earlier this year launched a new effort to set rules regulating how broadband providers manage Internet traffic on their networks. Netflix has urged the agency to begin regulating such agreements to do away with fees that content companies pay.
Though the FCC has not indicated that it plans to regulate the deals, the agency is now asking multiple Internet service providers and content companies, particularly video service providers, to provide details, Wheeler said.
“Consumers need to understand what is occurring when the Internet service they’ve paid for does not adequately deliver the content they desire, especially content they’ve also paid for,” he told reporters after a monthly FCC meeting.
“What we are doing right now is collecting information, not regulating. We are looking under the hood. Consumers want transparency. They want answers. And so do I,” he said.
In an earlier statement Wheeler said the commission is “not suggesting that any company is at fault.”
Consumer advocates, who support stricter regulatory oversight of relationships between content and Internet providers, welcomed the step and called on the FCC to make details of those agreements public.
It is unclear whether the FCC plans to do so.
Analysts pegged the FCC’s move as a win for Netflix, which on Friday welcomed the move toward more transparency.
“Americans deserve to get the speed and quality of Internet access they pay for,” Netflix spokesman Joris Evers said in a statement.
Netflix earlier this year agreed to pay fees to Verizon Communications and Comcast to bypass middlemen and deliver content directly to the companies’ subscribers, ensuring faster speeds.
“Netflix has been paying (for traffic delivery) since inception. It wants free, I get it, but someone has to pay for it,” Jim Cicconi, AT&T Inc senior executive vice president for external and legislative affairs, said last week.
Netflix streaming accounts for nearly one-third of North American web traffic during peak times, according to research by Sandvine Corp.
Netflix vice president for global public policy, Christopher Libertelli, this week said the company already invests money in delivering traffic to the Internet provider.
“We pay a lot of money to drop content at the doorstep of an ISP. All we’re really asking is for the ISPs to swing the door open,” Libertelli said at the Aspen Institute think tank. “This has become a new choke point.”
With Amazon’s Fire TV device the first out the door, the second wave of microconsoles has just kicked off. Amazon’s device will be joined in reasonably short order by one from Google, with an app-capable update of the Apple TV device also likely in the works. Who else will join the party is unclear; Sony’s Vita TV, quietly soft-launched in Japan last year, remains a potentially fascinating contender if it had the right messaging and services behind it, but for now it’s out of the race. One thing seems certain, though; at least this time we’re actually going to have a party.
“Second wave”, you see, rather implies the existence of a first wave of microconsoles, but last time out the party was disappointing, to say the least. In fact, if you missed the first wave, don’t feel too bad; you’re in good company. Despite enthusiasm, Kickstarter dollars and lofty predictions, the first wave of microconsole devices tanked. Ouya, Gamestick and their ilk just turned out to be something few people actually wanted or needed. Somewhat dodgy controllers and weak selections of a sub-set of Android’s game library merely compounded the basic problem – they weren’t sufficiently cheap or appealing compared to the consoles reaching their end-of-life and armed with a vast back catalogue of excellent, cheap AAA software.
“The second wave microconsoles will enjoy all the advantages their predecessors did not. They’ll be backed by significant money, marketing and development effort, and will have a major presence at retail”
That was always the reality which deflated the most puffed-up “microconsoles will kill consoles” argument; the last wave of microconsoles sucked compared to consoles, not just for the core AAA gamer but for just about everyone else as well. Their hardware was poor, their controllers uncomfortable, their software libraries anaemic and their much-vaunted cost savings resulting from mobile game pricing rather than console game pricing tended to ignore the actual behaviour of non-core console gamers – who rarely buy day-one software and as a result get remarkably good value for money from their console gaming experiences. Comparing mobile game pricing or F2P models to $60 console games is a pretty dishonest exercise if you know perfectly well that most of the consumers you’re targeting wouldn’t dream of spending $60 on a console game, and never have to.
Why is the second wave of microconsoles going to be different? Three words: Amazon, Google, Apple. Perhaps Sony; perhaps even Samsung or Microsoft, if the wind blows the right direction for those firms (a Samsung microconsole, sold separately and also bundled into the firm’s TVs, as Sony will probably do with Vita TV in future Bravia televisions, would make particular sense). Every major player in the tech industry has a keen interest in controlling the channel through which media is consumed in the living room. Just as Sony and Microsoft originally entered the games business with a “trojan horse” strategy for controlling living rooms, Amazon and Google now recognise games as being a useful way to pursue the same objective. Thus, unlike the plucky but poorly conceived efforts of the small companies who launched the first wave of microconsoles, the second wave is backed by the most powerful tech giants in the world, whose titanic struggle with each other for control of the means of media distribution means their devices will have enormous backing.
To that end, Amazon has created its own game studios, focusing their efforts on the elusive mid-range between casual mobile games and core console games. Other microconsole vendors may take a different approach, creating schemes to appeal to third-party developers rather than building in-house studios (Apple, at least, is almost guaranteed to go down this path; Google could yet surprise us by pursuing in-house development for key exclusive titles). Either way, the investment in software will come. The second wave of microconsoles will not be “boxes that let you play phone games on your TV”; at least not entirely. Rather, they will enjoy dedicated software support from companies who understand that a hit exclusive game would be a powerful way to drive installed base and usage.
Moreover, this wave of microconsoles will enjoy significant retail support. Fire TV’s edge is obvious; Amazon is the world’s largest and most successful online retailer, and it will give Fire TV prime billing on its various sites. The power of being promoted strongly by Amazon is not to be underestimated. Kindle Fire devices may still be eclipsed by the astonishing strength of the iPad in the tablet market, but they’re effectively the only non-iPad devices in the running, in sales terms, largely because Amazon has thrown its weight as a retailer behind them. Apple, meanwhile, is no laggard at retail, operating a network of the world’s most profitable stores to sell its own goods, while Google, although the runt of the litter in this regard, has done a solid job of balancing direct sales of its Nexus handsets with carrier and retail sales, work which it could bring to bear effectively on a microconsole offering.
In short, the second wave microconsoles will enjoy all the advantages their predecessors did not. They’ll be backed by significant money, marketing and development effort, and will have a major presence at retail. Moreover, they’ll be “trojan horse” devices in more ways than one, since their primary purpose will be as media devices, streaming content from Amazon, Google Play, iTunes, Hulu, Netflix and so on, while also serving as solid gaming devices in their own right. Here, then, is the convergence that microconsole advocates (and the rather less credible advocates of Smart TV) have been predicting all along; a tiny box that will stream all your media off the network and also build in enough gaming capability to satisfy the mainstream of consumers. Between the microconsole under the TV and the phone in your pocket, that’s gaming all sewn up, they reckon; just as a smartphone camera is good enough for almost everyone, leaving digital SLRs and their ilk to the devoted hobbyist, the professional and the poseur, a microconsole and a smartphone will be more than enough gaming for almost everyone, leaving dedicated consoles and gaming PCs to a commercially irrelevant hardcore fringe.
There are, I think, two problems with that assessment. The first is the notion that the “hardcore fringe” who will use dedicated gaming hardware is small enough to be commercially irrelevant; I’ve pointed out before that the strong growth of a new casual gaming market does not have to come at the cost of growth in the core market, and may even support it by providing a new stream of interested consumers. This is not a zero-sum game, and will not be a zero-sum game until we reach a point where there are no more non-gaming consumers out there to introduce to our medium. Microconsoles might do very well and still cause not the slightest headache to PlayStation, Xbox or Steam.
The second problem with the assessment is a problem with the microconsoles themselves – a problem which the Fire TV suffers from very seriously, and which will likely be replicated by subsequent devices. The problem is control.
Games are an interactive experience. Having a box which can run graphically intensive games is only one side of the equation – it is, arguably, the less important side of the equation. The other side is the controller, the device through which the player interacts with the game world. The most powerful graphics hardware in the world would be meaningless without some enjoyable, comfortable, well-designed method of interaction for players; and out of the box, Fire TV doesn’t have that.
Sure, you can control games (some of them, anyway) with the default remote control, but that’s going to be a terrible experience. I’m reminded of terribly earnest people ten years ago trying to convince me that you could have fun controlling complex games on pre-smartphone phones, or on TV remote controls linked up to cable boxes; valiant efforts ultimately doomed not only by a non-existent business ecosystem but by a terrible, terrible user experience. Smartphones heralded a gaming revolution not just because of the App Store ecosystem, but because it turned out that a sensitive multi-touch screen isn’t a bad way of controlling quite a lot of games. It still doesn’t work for many types of game; a lot of traditional game genres are designed around control mechanisms that simply can’t be shoehorned onto a smartphone. By and large, though, developers have come to grips with the possibilities and limitations of the touchscreen as a controller, and are making some solid, fun experiences with it.
With Fire TV, and I expect with whatever offering Google and Apple end up making, the controller is an afterthought – both figuratively and literally. You have to buy it separately, which keeps down the cost of the basic box but makes it highly unlikely that the average purchaser will be able to have a good game experience on the device. The controller itself doesn’t look great, which doesn’t help much, but simply being bundled with the box would make a bold statement about Fire TV’s gaming ambitions. As it is, this is not a gaming device. It’s a device that can play games if you buy an add-on; the notion that a box is a “gaming device” just because its internal chips can process game software, even if it doesn’t have the external hardware required to adequately control the experience, is the kind of notion only held by people who don’t play or understand games.
This is the Achilles’ Heel of the second generation of microconsoles. They offer a great deal – the backing of the tech giants, potentially huge investment and enormous retail presence. They could, with the right wind in their sales, help to bring “sofa gaming” to the same immense, casual audience that presently enjoys “pocket gaming”. Yet the giant unsolved question remains; how will these games be controlled? A Fire TV owner, a potential casual gamer, who tries to play a game using his remote control and finds the experience frustrating and unpleasant won’t go off and buy a controller to make things better; he’ll shrug and return to the Hulu app, dismissing the Games panel of the device as being a pointless irrelevance.
The answer doesn’t have to be “bundle a joypad”. Perhaps it’ll be “tether to a smartphone”, a decision which would demand a whole new approach to interaction design (which would be rather exciting, actually). Perhaps a simple Wiimote style wand could double as a remote control and a great motion controller or pointer. Perhaps (though I acknowledge this as deeply unlikely) a motion sensor like a “Kinect Lite” could be the solution. Many compelling approaches exist which deserve to be tried out; but one thing is absolutely certain. While the second generation of microconsoles are going to do very well in sales terms, they will primarily be bought as media streaming boxes – and will never be an important games platform until the question of control gets a good answer.
Speculation about Amazon’s plans for its TV service, including the possibility that it could launch its own streaming device, has increased ahead of a news conference in New York next week.
The Wall Street Journal reported on Thursday that the online retailer was considering a free, add-supported streaming TV and music service. Amazon spokeswoman Sally Fouts said no such plan was in the works.
“We have a video advertising business that currently offers programs like First Episode Free and ads associated with movie and game trailers, and we’re often experimenting with new things,” she said in an e-mail on Friday. “But we have no plans to offer a free streaming media service.”
Amazon’s streaming TV service currently comes included as part of its popular $99-a-year Prime service, which offers unlimited two-day shipping among other perks.
Google Inc deeply discounted its cloud computing service prices on Tuesday, seeking to woo customers away from Amazon.com Inc and Microsoft Corp in the fast-growing market of renting computers and data storage to companies.
Price cuts range from 30 to 85 percent. Google’s Cloud Storage will cost 2.6 cents per gigabyte, about 68 percent lower for most customers. Google’s Compute Engine services will cost 32 percent less across all sizes, regions and classes.
“The cost of virtualized hardware should fall in line with the cost of the underlying real hardware,” Google Senior Vice President Urs Holzle said in a post on Google’s official developers blog on Tuesday in conjunction with a cloud event that the company hosted in San Francisco.
Holzle noted that hardware costs have improved by 20 to 30 percent during the past five years but that “public cloud prices fell at just 8 percent per year.”
Cloud services are increasingly popular among tech startups and larger companies, which rely on computers owned and operated by the likes of Amazon and Google, the world’s No. 1 Internet search engine, instead of buying the equipment themselves.
Amazon, one of the largest online retailers, was among the first companies to recognize the opportunity. Amazon Web Services provide the underlying infrastructure for key aspects of popular Web companies such as online movie streaming service Netflix Inc and social network Pinterest.
Amazon did not immediately respond to a request for comment on whether it would respond to Google’s price cuts.
Earlier this week Cisco Systems Inc announced plans to spend $1 billion over the next two years to build a new cloud services business.
Apple Inc is having discussions with Comcast Corp to enter into a deal for a streaming-television service that would allow Appleset-top boxes to bypass congestion on the web, the Wall Street Journal reported, citing people familiar with the matter.
The discussions are in early stages and there are a lot of hurdles to be crossed before a definitive agreement could be reached, the Journal said.
Apple, which wants its TV service’s traffic to be separated from public internet traffic over the “last mile” for faster transmission, is looking for special treatment from Comcast’s cables to bypass congestion, the report said.
Comcast and Apple declined to comment on the report.
Apple has been in talks for a faster TV set-top box with Time Warner Cable Inc, which recently agreed to be bought by Comcast.
Apple’s $99 TV box competes with similar streaming devices from Roku and Google Inc.
Netflix agreed last month to pay Comcast Corp for faster speeds, throwing open the possibility that more content companies will have to shell out for better service.
The Federal Communications Commission is in the process of drafting a new “net-neutrality” bill that would ensure that network operators disclose exactly how they manage Internet traffic and that they do not restrict consumers’ ability to surf the Web or use applications.
The deal would mirror a first-of-its kind agreement that Disney and satellite rival Dish Network Corp announced earlier this week.
The Internet rights being discussed are part of a large-scale programming agreement that would replace a deal between the companies that expires in late December. Disney and Dish are in negotiations but the timing of the new deal could be not be learned.
“The deal and terms are not unexpected as the Dish contract was the most recent in the Disney timeline to expire,” DirecTV spokesman Darris Gringeri said on Wednesday. “The DirecTV contract is up next and we’re in the process of working with Disney on a similar long-term agreement of our own.”
A Disney spokesman declined to comment.
A new pact could give both Disney and DirecTV, the No. 1 satellite operator, an additional revenue source as consumers gravitate toward online video services such as Netflix Inc and watch more television online.
The agreement between Dish and Disney marked the first time that a U.S. pay TV operator has been given the flexibility to offer its content over the Web through smartphones, tablets and computers outside of a pay TV subscription.
In that agreement, Disney allows for Dish to stream linear and on-demand content from ABC broadcast stations as well as cable channels, ABC Family, Disney Channel, ESPN and ESPN2. Dish has not revealed plans for its streaming service.
DirecTV, which has 20.3 million subscribers, is expected to secure better rates on programming than Dish, which has 14.1 million subscribers, because of its size. Both companies have complained about the rising cost of programming and have been involved in high-profile blackouts over the past few years.
DirecTV Chief Executive Mike White has previously said the company is working on an “over-the-top” video package to suit niche audiences featuring Hispanic or kids programming, but has not yet given details on that offering.
Verizon Communications is engaged in discussions with content providers to deliver web-based TV services to mobile platforms, chief executive Lowell McAdam, said at an investor conference earlier in the week.
Just recently, Dish Network Corp and Walt Disney Co announced a landmark deal that will allow the No. 2 satellite TV provider to deliver Disney-owned network content online, outside of a traditional TV subscription.
Verizon’s goal “is to work with the content providers,” said
McAdam at the Morgan Stanley Technology, Media & Telecom Conference.
“I have personally had discussions with the CEOs of the large content companies, and we would love to partner with them to see how we can take FiOS contact mobilely across the country.” he said.
McAdam said the company could also look at providing a service delivered over wireless airwaves and not just broadband.
According to PwC’s annual entertainment and media forecast, North American consumers will spend $6 billion in 2014 on entertainment from services such as Netflix that are offered over the top, meaning they are utilized over a network but not offered by the network operator.
“I think you can actually get a virtuous cycle where broadcast viewing goes up and over-the-top viewing goes up, if you time this properly,” McAdam said.
In January, Verizon acquired Intel Corp’s OnCue service for an undisclosed sum to accelerate its push into next-generation video services, including integrating it with Verizon’s FiOS fiber-based Internet and TV service that has more than 5 million video subscribers, about 5 percent of pay TV households. The company said it was open to providing over-the-top content to any device.
McAdam also stressed that Verizon expects Netflix to pay for faster video delivery as part of a so-called interconnect deal, in an arrangement similar to the one the video provider has made with Comcast Corp.
“I have spoken live and via email with (Netflix CEO) Reed Hastings, and I believe that we will get some sort of an arrangement with them as well,” said McAdam.
Still, Verizon has had its own interconnection discussions with Netflix related to increasing the video provider’s traffic speeds on the broadband carrier’s networks, Verizon Chairman and CEO Lowell McAdam said. Following a Sunday announcement that Comcast and Netflix had reached an interconnection deal, McAdam said his company has had similar discussions with the video provider.
The Comcast and Netflix deal shows “the commercial markets can come to agreement on these to make sure the investments keep flowing,” McAdam said.
McAdam addressed the U.S. Federal Communications Commission’s proposed net neutrality rules during a conference call about the company’s acquisition of Vodafone’s 45 percent stake in Verizon Wireless. The FCC’s move this month to resurrect net neutrality rules should provide “clarity” for the broadband industry, said McAdam, whose company successfully challenged an old version of the regulations in court.
McAdam dismissed concerns that his company would selectively block or slow some Web content. “We make our money by carrying traffic,” he said. “That’s how we make dollars. So to view that we’re going to be advantaging one over the other really is a lot of histrionics, I think, at this point.”
But McAdam suggested that broadband power users should pay extra. “It’s only natural that the heavy users help contribute to the investment to keep the Web healthy,” he said. “That is the most important concept of net neutrality.”
The FCC needs to look at the broad Internet industry, not just broadband providers, when it considers new net neutrality rules, McAdam said. Companies like Netflix, Apple, Microsoft and Google have a role, and “any rules will have to include all of these players,” he said.
McAdam called for the FCC to create “light touch” rules on net neutrality. The FCC needs to consider growing uses of broadband in medicine and other fields, he said. “Everything from health care to telematics to the energy grid need to be balanced with someone who’s trying to watch last year’s episode of [TV show] NCIS,” he said.
McAdam said he’s “encouraged” that the latest FCC effort may bring clarity on net neutrality rules.
The company is investing in original content to attract customers to its $79-a-year Amazon Prime service, which competes for online viewers with services such as Netflix and Hulu.com. Prime also includes free two-day shipping for Amazon products.
The new pilots include three comedies and two dramas for adults, plus five children’s shows. Amazon will make a decision on how many to put into development after customers have their say by leaving online comments and ratings.
Malcolm McDowell stars in the comedy “Mozart in the Jungle,” a story about “sex, drugs — and classical music,” an Amazon statement said.
A science-fiction show, “The After,” was written and directed by “The X-Files” creator Chris Carter.
Amazon chose the pilots after looking at the genres that are popular with its customers, said Roy Price, director of Amazon Studios.
“Customers have responded really well in the past to sci-fi,” Price said in an interview. “We start with some areas that customers are responding to and try to develop shows that fit in there.”
Other pilots include “Transparent,” a dark comedy about a dysfunctional family that stars Jeffrey Tambor and Judith Light, and “Bosch,” based on best-selling novels about a Los Angeles homicide detective.
The new pilots are available for a month in the United States on Amazon.com and through the Amazon Instant Video app, and in Britain through Amazon’s Lovefilm streaming service.
Last year, Amazon released two comedy series, “Alpha House,” starring John Goodman as a senator, and “Betas,” about a tech start-up, after considering customer input on 14 pilots.
Three children’s series also were selected during that process, which brought in thousands of customer reviews within a few days, Price said.
Netflix Inc gained more than 2.3 million U.S. subscribers in the fourth quarter, sending its shares up 17 percent in after-hours trading, and said it was testing different pricing plans for its monthly TV and movie streaming service.
The world’s largest video streaming company on Wednesday reported net income of $48 million for the quarter, up from $8 million a year ago. Earnings-per-share were 79 cents, Netflix said in a statement, beating the 66 cents average forecast of analysts surveyed by Thomson Reuters I/B/E/S.
The strong U.S. subscriber growth, a closely watched barometer of company performance, came in at the top end of Netflix’s forecast range. Netflix also signed up 1.74 million new customers in foreign markets, bringing its worldwide total to 44.4 million.
Answering critics who question how big Netflix could grow, the company said it expected to add more U.S. subscribers in the first quarter of 2014 than in the year-ago period.
“We expect this momentum to continue in Q1 with net additions of 2.25 million to exceed the prior year by about 11 percent,” the company said in its quarterly letter to shareholders.
Netflix shares, one of the highest-flying stocks of 2013, jumped more than 17 percent in after-hours trading to $391.77, eclipsing the all-time intraday trading high of $389.16 the stock hit in October.
In its shareholder letter, Netflix noted it had been testing variations of its $8 monthly charge “at various price points.” The company also said it “eventually” hopes to offer three pricing options “to fit everyone’s taste.”
Existing members would receive “generous grandfathering of their existing plans and prices,” the letter added.
In an interview, Netflix CEO Reed Hastings said it “could take longer than a year” for the company to set new prices.
“It just depends on when we feel comfortable we’ve got something that feels really fair and appropriate to consumers,” he said.
Netflix suffered from a consumer backlash and stock plunge after it announced an unpopular price increase in July 2011.
Hastings discounted a recent U.S. court ruling on “net neutrality” that some analysts said might lead broadband providers to charge the company for quick delivery of its video content, possibly inflating costs for the company.
“Our economic interests are pretty aligned,” he said. Broadband providers want to sell higher-priced service with faster speeds and need content for it from services like Netflix that work well with faster speeds, Hastings explained.
The CEO said he would like to reach a deal with a U.S. cable operator to have Netflix accessed from their set-top boxes.
“People will use Netflix anyway and I’d think (cable operators) would rather have them use it on their boxes rather than on Roku or some other box,” Hastings said.
Netflix is investing in original programming, such as the “House of Cards,” and “Orange is the New Black” series to attract and keep subscribers. If faces competition from online video players like Amazon.com Inc and Hulu, as well as on-demand content from cable operators.
But the company reported shrinking losses in international markets.
“The international losses are going to subside and therefore show the strength of the overall streaming business,” said FBN Securities analyst Shebly Seyrafi, who rates Netflix an “outperform.”
The company projected it will add 1.6 million customers in foreign markets from January through March.
It said it plans a “substantial European expansion” later this year, but did not disclose the markets it is looking at. The company currently operates in Canada, Latin America and seven European countries.