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Netflix CEO Considering Streaming-Only Option in U.S.

 & Chloe Albanesius Executive Editor, News

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Netflix is considering the launch of a streaming-only U.S. subscription option in the next few months, chief executive Reed Hastings said Thursday.

On Friday, Netflix also expand its licensing agreement with NBC Universal to allow members to watch select NBC content via its "Watch Instantly" streaming library for the first time.

The U.S. streaming-only option would allow users to sign up for access to "Watch Instantly," but not its DVD delivery service. All Netflix subscriptions currently provide access to its streaming library, but the cheapest option in the U.S. is now $8.99 per month, which allows users to check out 1 DVD at a time.

"We are looking at adding a streaming-only option for the USA over the coming months," Hastings said in a blog post.

Netflix this week launched its service in Canada, where it is offering a streaming-only option for $7.99 per month.

Hastings's blog post was not simply to announce a planned U.S. streaming-only launch, but to apologize for a comment he made about Americans being too self-absorbed. In an interview with the Hollywood Reporter, Hastings was asked if Americans would ask for the same $7.99 streaming-only option Canadians were receiving. Hastings responded, "How much has it been your experience that Americans follow what happens in the world? It's something we'll monitor, but Americans are somewhat self-absorbed."

Hastings said Thursday that his comment was an "awkward joke."

"I was wrong to have made the joke, and I do not believe that one of the most philanthropically-minded nations in the world (America) is self-absorbed or full of self-absorbed people," he wrote. "My apologies to anyone offended by my self-absorbed comment."

It's been a week of apologies for the company. Also on Thursday, Netflix apologized for allowing hired extras to misrepresent themselves as potential Netflix customers and speak to the news media at a launch event for Netflix in Canada.

Despite the gaffes, Netflix is likely to survive. The company added 3.06 million subscribers in the last quarter to just over 15 million. Netflix also said that the percentage of subscribers who viewed "Watch Instantly," or more than 15 minutes of a TV episode or movie, sometime during the second quarter was 61 percent, versus 37 percent for the same period a year ago, and 55 percent for the first quarter.

The company's "Watch Instantly" library does not provide access to Netflix's entire content library; most new releases, for example, are not available. But Netflix has inked several content partnerships in the past few months that will bulk up the number of options in the library, including deals with Nu Image/Millennium Films, Epix, and Relativity Media.

On Friday, those options expanded to include NBC content, including episodes of "Saturday Night Live," "30 Rock," "The Office," "Law & Order: SVU," "Friday Night Lights," and "Psych." Netflix will also add more than 75 episodes of Syfy's "Battlestar Galactica."

The multi-year NBC-Netflix deal kicks off next week.

A Netflix spokesman said Friday that he did not have additional details on whether "Watch Instantly" would be further expanded for a U.S. streaming-only launch.

In August, Netflix released a version of its mobile app that is compatible with the iPhone and iPod touch. The upcoming Apple TV will also have access to Netflix.

About Our Expert

Chloe Albanesius

Chloe Albanesius

Executive Editor, News

My Experience

I started out covering tech policy in DC for The National Journal, where my beat included state-level tech news and all the congressional hearings and FCC meetings I could handle. I later covered Wall Street trading tech before switching gears to consumer tech. I now lead PCMag's news coverage.

My Areas of Expertise

Getting my start in DC means I still have a soft spot for tech policy; Congressional hearings can sometimes be as entertaining as a Bravo reality show, for better or worse. But PCMag is all about the technology we use every day, as well as keeping an eye out for the trends that will shape the industry in the years ahead (or flop on arrival). I've covered the rise of social media, the iOS vs. Android wars, the cord-cutting revolution that's now left us with hefty streaming bills, and the effort to stuff artificial intelligence into every product you could imagine. This job has taken me to CES in Vegas (one too many times), IFA in Berlin, and MWC in Barcelona. I also drove a Tesla 1,000 miles out west as part of our Best Mobile Networks project. Of late, my focus is on our hard-working team of reporters at PCMag, guiding and editing their robust coverage.

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