Netflix Sags On Blockbuster/Tivo Deal; A Movie Glut?

Netflix (NFLX) shares are sagging on investor concerns about this morning’s announcement that Blockbuster (BBI) has cut a deal to provide movies over TiVo (TIVO) DVRs. Content will be available to both buy or rent; companies expect the service to launch in the second half. The deal also calls for Blockbuster to sell TiVo DVRs in its retail stores. TiVo will offer about 10,000 titles from Blockbuster, with rentals for $1.99 to $3.99 each and sales at $14.99 to $19.99 apiece. That worries Netflix holders, for a few reason. For one, space on the TiVo box is getting crowded; the company already has deals with both Netflix and Amazon.com (AMZN) . It also suggests that maybe Blockbuster isn’t quite the financially cripple that some investors recently thought. There is a big difference, though, which is that Blockbuster and Amazon have a pay-per-view model, while Netflix offers a subscription service with no extra fees for streaming movies over the Web, whether you watch ... (link)