Movie and Television studios have been waging a war against Netflix for some odd reason. I think they need to take a step back and realize that Netflix should not be their concern. Netflix is the bridge between folks watching their content, vs folks not knowing or caring about their content.
Recently, JoDee got hooked on Doctor Who. Now, prior to Christopher Eccleston / Russel T. Davies versions of Doctor Who, I couldn't have cared less about The Doctor. Once JoDee got hooked by our dear friend Michelle, I managed to look over JoDee's shoulder enough times while she was watching to start getting into the series. Before we knew it, we were streaming through the David Tennant version of Doctor Who via Netflix, and are now watching the Matt Smith version of Doctor Who via DVD rental from Netflix. And when season 6 comes around, we'll probably re-watch them on Netflix when they're available.
What does this have to do with the studios' war on Netflix? Had there not been a way to legally watch this show via Netflix, we might have found other means to watch it. Since the DVDs are expensive ($80+) we may get them at some time, but that would also compete with other purchase decisions. However, because of Netflix, we get to see the show, and the studios get paid for the rental discs.
Let's take another show that we've been watching recently: Tripping the Rift. Had we not had Netflix, we would have never seen this show, and the liklihood of me even purchasing the discs prior to viewing the show would be so remote as to not even be measurable by modern instruments. Yet, since we saw the show via Netflix streaming, I can now say that it's pretty enjoyable, and would it show up at Best Buy at the right price, I might make an impulse purchase. Had the studio chosen not to make it available, I would never have had the chance to see this, nor would it have been on my radar.
Studios are well within their rights to do whatever they want with their content, but the competition isn't between DVD sales vs. Netflix, it's between attention and apathy. Netflix allows folks to discover things they might not have otherwise cared about, and gives folks a chance to preview before purchasing. You'd better believe that those Doctor Who discs will be purchased at some future date, whereas before they wouldn't have even registered a blip on my consumer radar.
If studios begin to treat Netflix as an attention marketplace rather than as a place of lost sales, they'll start to understand why Netflix is a very important part of the whole retail cycle. Studios that misunderstand, and jerk around this marketplace are doomed to repeat the same mistakes with video rentals, home video sales, and VCRs / Tivo. When studios see the difference between attention and apathy as the key to driving sales, they'll begin to see a resurgence in sales. Pulling their stuff off of Netflix, and jerking around their customers is the quickest and surest way to ensure folks don't give a damn (or if they give even the sligtest bit of a damn, that they figure out other ways to view the content that don't involve the studio).
Now, if you'll excuse me, disc 5 of Season 5 is calling me.