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Netflix and LG Electronics said today that they’re developing a set-top box that will allow consumers to stream movies and other content directly from the Web to their high-definition TVs, reports the NY Times.

The new Netflix-enabled LG player is slated to be available in the second half of 2008. The product is expected to be shown off during next week’s Consumer Electronics Show in Las Vegas.

For a basic subscription rate starting at $4.99, traditional Netflix customers rent DVDs online and have them delivered via first-class mail, complete with postage-paid return envelopes. Almost 95% of Netflix subscribers live in areas that can receive discs in one business day. The company has a library that carries more than 90,000 titles.

“Internet to the TV is a huge opportunity,” commented Reed Hastings, Netflix’s founder, chairman and chief executive, in a statement. “Netflix explored also offering its own Netflix-branded set-top boxes, but we concluded that familiar consumer-electronics devices from industry leaders like LG Electronics are a better consumer solution for getting the Internet to the TV.”

Amazon.com lets customers buy movies for TiVo settops over its Unbox service.

Apple TV may expand its setop box service this month by debuting a compatible iTunes movie rental service at Macworld Expo this month, says Apple Insider. The Apple device, however, requires that users download content to their computers before channeling it wirelessly to the Apple TV.

In a 24-page complaint (PDF) plaintiff Stacie Somers — a San Diego County woman who bought a 30-gigabyte iPod from Target in fall of 2005, backed by a group of big-shot antitrust attorneys — states that Apple’s iTunes online music and video store dominates the market with “approximately” 83 percent of the music market and “at least” 75 percent of the video market. It puts Apple’s market share among digital music players at “more than” 90 percent for hard-drive based players and “approximately” 70 percent of the flash memory segment.

Perhaps the real motive of LG is to pitch their modified ATSC system. Corporate media would like to shift free over-the-air television broadcasting to subscription Pay TV and Subscription Radio. LG Electronics and Harris developed the MPH In-Band Mobile DTV system to do just that. It is capable of providing robust DTV signals to mobile, pedestrian and handheld devices — or settop boxes.

LG (Zenith) gets royalties on every ATSC television sold in the United States. But ATSC doesn’t reject multi-path ghosts as well as the COFDM-based DVB system in Europe. LG’s approach has been to ruggedize ATSC for mobility while keeping the ATSC royalty stream coming.

Mark Cuban thinks HD On Demand is Crazy Talk:

What happens when we go High Def? Lets see we can get by with the lowest quality and only 6mbs of bandwidth. If its a challenge and costs a fortune to delivery 300k streams at 350k, how long do you think it will be before we can do the same over the internet with 6mbs or the required 8mbs for low end and 12 mbs for high end content? It aint gonna happen anytime soon. Not this year. Not next. Not 5 years. Not 10 years.

Is the LG and NetFlix deal really about HD over the internet? Serving up HD on demand (uni-casting) could be too expensive and slow to be practical for the narrowband United States. Perhaps with FIOS or AT&T, sure. Perhaps the LG/Netflix announcement is really all about multi-casting with ATSC. But Disney tried it and went bust.

Another fine mess brought to you by the National Association of Broadcasters.

Related Mobile TV articles on DailyWireless include; Mobile/Handheld TV: Killer App?, Mobile TV War at NAB, Mobile TV: Six Flavors and NAB 2007: Dead Man Walking?

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