PS3 Netflix: The best use of BD-Live yet

Finally, Sony's PlayStation 3 home video game console and Blu-ray player will be receiving Netflix Instant streaming, a feature which has appeared on a number of other pieces of hardware, including rival console Xbox 360 and connected Blu-ray players from manufacturers such as Samsung, LG, and even Sony itself.

But unlike those other platforms, which connect to Netflix Instant Streaming through an interface native to the console, PlayStation 3 users will be required to boot up the service from a Netflix Blu-ray disc, which utilizes BD-Live to access the online content. BD-Live is a Blu-ray standard which lets a disc have downloadable bonus content instead of limiting it to content burned onto the disc.

Wedbush Morgan analyst Michael Pachter believes the BD-Live technique was chosen to work around some exclusivity clauses between Netflix and Microsoft, but the real reason is unknown. We've contacted Netflix and Sony for comment on Pachter's hypothesis, and will update with their responses as they arrive.

But whatever the reason, the inclusion of Netflix on PlayStation 3 means big things. Firstly, and most obviously, it takes away one of the major exclusive capabilities of Microsoft's Xbox 360 and offers it for free. On the 360, Netflix subscribers must also be an Xbox Live gold member, which costs $50 a year, raising the price of Netflix streaming-only access by some 46%. This adds fodder to the debate that the PS3's online capabilities are not as good as the 360's, but are at least offered freely.

Secondly, this will help expose even more consumers to Netflix Instant streaming. The PS3 has an estimated 9 million users now, and numbers have been swelling rapidly thanks to the recent -- and long demanded -- console price cut. The Netflix disc can be obtained free of charge and opens the PS3 to the streaming library of more than 17,000 titles. Rather than pack the disc with the PlayStation 3, Netflix is only making the Instant Streaming discs available through the mail, which could ensure higher customer conversion.

Thirdly, this has potential to be the single largest use of BD-Live yet. In September, Deluxe Digital Studios said users were connecting to BD-Live about 4 million times a month, with the majority of interest coming in the form of downloadable trailers. Meanwhile, the first three months after Netflix was introduced on Xbox Live, more than 1 million users were connected to the service for 1.5 billion minutes. Even if users were connecting to BD-Live in five-minute increments, which is long for a trailer, that would still only amount to 20 million minutes a month.