The LG BD300 Blu-ray Disc Player, available this fall, and the Netflix instant Queue as it will appear on the TV.

Netflix + LG + Blu-ray could equal dream machine

Netflix seems determined to thwart its original business model. Or maybe it's just being evolutionary. Tonight, the company that swamped the postal service with little red envelopes will unveil its third direct-to-the-TV partnership. And each design is more tempting than the last.

First came the $100 Roku box, which streams movies and shows straight to TV sets – but does nothing else. Then came a deal with Microsoft to use Xbox 360s as a back door to Netflix online video.

Now, the company teams up with LG to build a multipurpose set-top box. It streams movies, upconverts DVDs to HD quality, and plays Blu-ray discs.

The device, which won’t reach stores until October, will cost “less than $500” – plus the price of a standard Netflix subscription. Plans start at $8.99. Current Netflix users can enjoy all the online video at no extra charge. (By the way, subscribers can already access Netflix streaming videos on their computers for free. These boxes are for families that find their couches more comfortable than their desk chairs.)

While the DVD-by-mail service offers 100,000 titles, this box can only channel maybe a tenth of that. The limited library is the result of copyright issues. Hollywood isn't ready to let fully embrace streaming content yet. However, as Netflix enters more living rooms through deals with Microsoft and LG, expect the movie studios to open up more content.

We might even see HD-quality streaming video in the near future. The Roku box is already capable of piping HD movies to your TV. But, right now, there’s nothing in HD to send. Home Internet connections will probably have to improve before Netflix is ready for that leap. As the Monitor reported last year: "19 million Americans watched the season premiere of ABC's 'Desperate Housewives' on TV [in 2007]. If all of those viewers had seen the program on the Internet in HD quality instead, it would require 4.5 terabytes of Internet capacity each second. That's triple the amount used on the entire Internet."

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