Netflix (NFLX)

We intend to engage a number of partners to offer instant streaming of content from Netflix to various devices.

We currently offer subscribers the ability to receive streaming content through their PCs, Macs and other devices, including the Xbox 360, Internet connected Blu-ray players from LG Electronics and Samsung, TiVo

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and the Netflix Player by Roku. We intend to broaden our capability to instantly stream movies and TV episodes to other platforms and partners over time. If we are not successful in maintaining existing and creating new relationships, or if we encounter technological, content licensing or other impediments to our streaming content, our ability to grow our business could be adversely impacted. Our agreements with our consumer electronics partners are typically between one and three years in duration and our business could be adversely affected if, upon expiration, our partners do not continue to provide access to our service or are unwilling to do so on terms acceptable to us. For example, while the PC and Mac platforms constitute the largest number of devices used by our subscribers to enjoy streaming content, the agreement covering the next largest number of devices will expire in late 2009, unless the partner exercises its option to extend. If such agreement were to terminate, our subscriber acquisition and retention could be adversely impacted. Furthermore, devices are manufactured and sold by entities other than Netflix and while these entities should be responsible for the devices’ performance, the connection between these devices and Netflix may nonetheless result in consumer dissatisfaction toward Netflix and such dissatisfaction could result in claims against us or otherwise adversely impact our business. In addition, technology changes to our watch instantly functionality may require that partners update their devices. If partners do not update or otherwise modify their devices, our service and our subscribers use and enjoyment could be negatively impacted.

We intend to engage a number of partners to offer instant streaming of content from Netflix to various devices.

We currently offer subscribers the ability to receive streaming content through their PCs, Macs and other devices, including the Xbox 360, Internet connected Blu-ray players from LG Electronics and Samsung, TiVo

10

Table of Contents

and the Netflix Player by Roku. We intend to broaden our capability to instantly stream movies and TV episodes to other platforms and partners over time. If we are not successful in maintaining existing and creating new relationships, or if we encounter technological, content licensing or other impediments to our streaming content, our ability to grow our business could be adversely impacted. Our agreements with our consumer electronics partners are typically between one and three years in duration and our business could be adversely affected if, upon expiration, our partners do not continue to provide access to our service or are unwilling to do so on terms acceptable to us. For example, while the PC and Mac platforms constitute the largest number of devices used by our subscribers to enjoy streaming content, the agreement covering the next largest number of devices will expire in late 2009, unless the partner exercises its option to extend. If such agreement were to terminate, our subscriber acquisition and retention could be adversely impacted. Furthermore, devices are manufactured and sold by entities other than Netflix and while these entities should be responsible for the devices’ performance, the connection between these devices and Netflix may nonetheless result in consumer dissatisfaction toward Netflix and such dissatisfaction could result in claims against us or otherwise adversely impact our business. In addition, technology changes to our watch instantly functionality may require that partners update their devices. If partners do not update or otherwise modify their devices, our service and our subscribers use and enjoyment could be negatively impacted.

We intend to engage a number of partners to offer instant streaming of content from Netflix to various devices.

We intend to engage a number of partners to offer instant streaming of content from Netflix to various devices.

We intend to engage a number of partners to offer instant streaming of content from Netflix to various devices.