Netflix May Soon Let You Download Its Videos

All signs point to Netflix adding a new feature to its streaming service: temporary downloads.

Dan Taitz, chief operating officer at Penthera, which sells software to streaming video providers that lets viewers download content, told Fortune on Friday that "it's obvious" that Netflix NFLX will jump into the downloads market. He added that he's been hearing from many "industry sources," including content providers and cable TV operators, that it's only a matter of time.

"From industry sources, I know that Netflix is out in the market negotiating to get download rights in addition to streaming rights," Taitz told Fortune. "Content providers are getting asked that now from Netflix so [Netflix] can offer a download service."

Taitz, who previously spoke to LightReading, a site that tracks the communications industry, is in a position to know what Netflix may be up to. His company has worked with Comcast CMCSA , Starz, and Charter CHTR , among others.

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Taitz didn't say which industry insiders said Netflix is planning downloads and admitted that he's hearing it all "second hand." But he's says he's been told by a wide range of companies including content providers, cable operators, and other streaming service providers.

While Netflix has long been the biggest U.S. streaming provider, it's actually trailing many of its competitors, including its chief rival Amazon AMZN , in downloads. In fact, customers using Amazon Prime Video have had the option to download videos from its streaming service since September.

After Amazon's launch, Netflix chief product officer Neil Hunt was asked by gadget blog Gizmodo why his company doesn't offer downloads. While Hunt acknowledged that it's a heavily requested service among Netflix users, offering both streaming and downloads, he said, would create a "Paradox of choice" and ultimately cause anxiety among Netflix users.

"One of the things I've learned is that every time you offer a choice, you paralyze some people who can't decide if that's what they want to do or not," he said. "Now, that sounds really stupid and self-serving, but it is in fact true."

However, Netflix, which declined to comment on Taitz's comments on Friday, has recently changed its tune. During an earnings call in April, Netflix CEO Reed Hastings said his company must "keep an open mind" about downloads. He didn't necessarily commit to downloads, but Netflix's iciness towards it appears to be thawing.

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"I think it's obvious that Netflix is going to do it," Taitz says. "Amazon launched it almost a year ago now, Starz has launched it, Epix has launched it. Netflix isn't going to be the streaming leader and the only one who doesn't offer downloads."

So, how might it work? That's tough to say, since each company's service is a bit different. However, in many cases, users have the ability to download videos at no additional charge and can watch them for a period of time established by the streaming provider. After the show has been watched or it's hit the time limit for how long it can remain saved, it vanishes from the user's device.

Netflix would presumably offer a similar service that would give users the option to download at least some of its content, but require them to watch it within a certain period of time. It might work best when an Internet connection is spotty or unavailable, like on a plane.

"These are temporary downloads, meaning it's not meant to replace buying or renting," Taitz says.

Taitz says that his industry sources have no "timetable" for when Netflix may launch its download service, but he guessed, based on how the industry is increasingly moving towards a download option, that it will happen this year. He added that Penthera had approached Netflix to offer its service, but Netflix declined the overture. Like Amazon, he said, Netflix could be planning to build its downloading service in-house, rather than rely on a third-party service.

For now, then, Netflix is streaming-only. But it looks like that might change.


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