If there’s a silver lining to the company’s success, it’s that the new streaming service, which works quite well on the Xbox 360, costs the company money, with CFO Barry McCarthy calling it a “tax on the P&L [Profit and Loss Statement].” Basically, it’s a down payment on future success. That’s what Netflix hopes, at least.
As for adding new videos to the 12,000 title library, Netflix says it could easily do so, at the flip of a switch. Unfortunately, that switch costs a lot of money to flip, and Netflix still isn’t sure if it can turn a profit with the service yet. So let’s give Netflix a little bit of breathing room before freaking out.