Netflix fired back this afternoon by announcing a new content deal with CBS. 

Some golden oldies are in the mix, including full seasons of Star Trek, Frasier and Cheers. 

Netflix is now the only streaming service to carry ABC, NBC, CBS and FOX, making it the hub the incumbent networks should have built a long time ago. 

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In a lengthy blog post, Kilar laid out the future of web TV as Hulu sees it, and didn't mince words when describing the traditional TV networks, Hulu's parent companies. 

"History has shown that incumbents tend to fight trends that challenge established ways and, in the process, lose focus on what matters most: customers. Hulu is not burdened by that legacy."

Kilar says Hulu is on track to reach a half billion dollars in revenue this year, a number that includes advertising and subscription fees, and points out that his company is already earning very attractive rates on ads when compared to the industry as a whole. 

Often Hulu is referred to as the corporate teacher's pet in the landscape of web TV, but it's clear Kilar has a different identity in mind.

"A number of you that are reading this might be thinking that we’d have to be crazy to think that our small team can actually re-invent television and compete effectively against a landscape of distribution giants like cable companies, satellite companies, and huge online companies," he wrote. "We are crazy. All entrepreneurs need to be."

bpopper [at] observer.com | @benpopper

"We’re in a bit of an awkward spot at the moment," wrote Boxee's Andrew Kippen on the company blog. "The Netflix app is up and running on Boxee (we watched the intro to Full Metal Jacket earlier today), but we have not yet satisfied Netflix’s security requirements."

The company had a terrific showing at CES, but has not done itself any favors with users by continually promising and then delaying the release of its Netflix app. 

At the core of this conundrum is that Boxee is less of a closed, commercial platform than services like Roku or Apple TV. And that's what its customers appreciate.

"I choose Boxee because it was the most open platform with the biggest content ecosystem," wrote user Mark Davis on the Boxee blog. "Because they are so open it’s harder for for them to support Netflix’s content."

See, Boxee? Users understand. You and Netflix can come out when you're ready. We'll be waiting. 

bpopper [at] observer.com | @benpopper

But Time Warner CEO Jeff Bewkes isn't worried about Netflix's growing presence in the media landscape.

“It’s a little bit like, is the Albanian army going to take over the world?” Bewkes told The New York Times in an interview last week. “I don’t think so.”

Actually, at this point Netflix is roughly 7 times larger than the entire nation of Albania. What's more, as a new report from Forrester shows, the Internet is now as popular as television in the United States.

Bewkes hopes the high price of licensing content will turn Netflix into an entertainment ghetto. “At $8 to $10, it doesn’t have the economics to support high-value programming,” he said.

Will skyrocketing costs for digital licensing cripple Netflix? Doubtful. It is already trimming expenses by transitioning from physical DVD rentals to streaming only plans. 

Even folks who use Hulu prefer Netflix. A recent study found just 4 percent of Hulu users pay the monthly fee for Hulu Plus, while 88 percent were Netflix subscribers. 

On the heels of introducing a new streaming only service for $7.99, Netflix this morning announced a new distribution deal with FilmDistrict. As another in a recent series of major content partnerships, this deal is interesting enough. 

But more important, Netflix's deal with FilmDistrict doesn't include the standard "pay TV window", wherein new releases go to the cable industry first, then premier on Netlifx a few months later. 

As Netflix continues to expand aggressively into traditional TVs turf, the big boys are playing dirty. Yesterday Comcast slapped Netflix partner Level 3 Communications with additional traffic fees. 

Netflix accounts for 20% of total online traffic during prime time, seemingly certain to be the battleground for the long and bitter war brewing between online outfits and the cable industry.

bpopper [at] observer.com | @benpopper

That seems to be the strategy of the cable companies. Last week Comcast reported that it had lost 275,000 subscribers in the third quarter and this week Time Warner announced it had seen 155,000 customers terminate their service.

When faced with these quarterly losses in the past, the cable companies insisted that they have seen no evidence that customers are "cutting the cord," a catch phrase for dropping cable in favor of streaming video over the web. Instead, they blamed the poor economy, the customer, anything to avoid the truth. From The New York Times:

"The customers they are losing tend to be in the bottom half of the economy -- a lot of them appear to be struggling to make ends meet," said Craig Moffett, an analyst at Sanford C. Bernstein & Company,

Mr. Moffett said the image of the cord-cutter had been that of a "cutting-edge technologist" who preferred to bypass cable to watch programming on computers and on an ever-proliferating array of devices. "The reality is it's someone who's 40 years old and poor and settling for a dog's breakfast of Netflix and short-form video."

Unfortunately, a recent study from Strategy Analytics failed to support Mr. Moffet's conclusion. It found that:

• •54% of likely cord cutters are under 40.
• •97% have graduated high school and 69% have or are pursuing higher degrees.
• •91% are employed, full time students, or retired
• •57% make more than $50,000 a year

Who knows -- Mr. Moffet may not be all wrong. Some of these well educated, well-off cord cutters may still enjoy the occasional bowl of dog food while streaming movies from Netflix.