“Never mistake a clear view for a short distance.”
    Paul Saffo

    “We tend to overestimate the effect of a technology in the short run 
    and underestimate the effect in the long run.”
    Roy Amara

I looks like they have mastered funding the transition to the next generation--yet to be profitable according to the NYT article--by preserving the DVD business as a cash cow. See also

http://www.skmurphy.com/blog/2011/10/11/learning-from-netfli...

http://www.skmurphy.com/blog/2011/10/14/learning-from-netfli...