Some other key points that you are missing is not everyone has cable, especially digital cable which is required for VOD. Many have satellite, or like my family, we have neither. There is too much trash on TV (even the commercials) and people with young kids like myself prefer to monitor what my kids view. I don't like parading them through Blockbuster to find a kids' movie because the pictures on the movie covers are basically porno. With Netflix, I can shop with my kids in my lap through the family listings and find something appropriate.
ntack - right on. Even more so, I never step into a movie rental store. I rent "grown up" movies through Netflix to watch after my child is asleep. Taking her into a movie rental store is like taking her into a candy store in the children's aisle and too much violence, sex and inappropriate material in all the other aisles. Not a good place for a child.
With NFLX, the movies just keep coming in like clock work. And with "Watch Now" you have VOD at no additional cost. Just connect your computer to the TV, no big deal. A trip to Radio Shack for the s-video cable will do it. I think the beauty is in the simplicity of the solution. Later on, if they partner with Cisco to get a wireless connection between the computer and the TV, great. That will make it even better. Remember, Cisco is on NFLX's board and they want to bring wireless to every home.