It seems to me that if Netflix would record their movies on Flash-drives instead of CD’s it would be more convenient for both the company and the consumer. Also, more than one movie (if ordered) could be recorded on the same FD. Just mail the FD back in a package, similar to the mail pouch, and receive a new one with a new movie(s). 
Copyright concerns, for one thing.
For another, people use DVDs because they want to watch on a DVD player instead of on a computer. They may not even have a computer, but still have a DVD player.
In addition to RealityChuck’s practical points, think logistics.
It’s far easier grabbing a DVD, slip it into an envelope and add it to the mail queue. Using a Flash drive requires extra time to download the movie(s) from a master server to the drive, verifying the download(s) worked as intended, before posting out the drive in a proper container which would not be a flat envelope. Then there’s the added cost of the drive itself, plus the cost for “lost” drives, among other things.
Think KISS Principle. It’s not rocket science but most movie users aren’t up to SDMB standards. 
Furthermore, streaming the movie online upon the user’s ordering it gives them the best of all possible outcomes: you pay, you watch, and no (well, less) opportunity for content theft. I think they’ll put their resources towards that method, instead of flash drive distribution.
This. They already have a great streaming system in place. The only detriment is that their DVD library is many times larger than their streaming library, but they are getting closer by the second. Plus, they would have to implement a way to prevent someone from copying the data from the flash drives to appease the MPAA and Hollywood studios. Coupling this with the fact stated above that many people do not want to watch movies on their computers (or don’t have one) pretty much precludes any appearance of flash-drive-movies-by-mail.
You do know that Netflix doesn’t distribute CD’s at all, don’t you? And there is a vast difference between a CD and a DVD, in spite of their similar appearance?
Not all things round and shiny are CDs.
CD stands for Compact Disc, does it not? Compared with a Laserdisc, or a record, I’d say a DVD is pretty damn compact. And I wouldn’t say the differences between them are too vast, either. They are both thin sheets of reflective material encased in plastic, with microscopic pits and lands representing binary code read by a laser. CDs can even be read by DVD drives. All this combined with the fact that their form factor is identical, I think OP can be forgiven for his slip-up.
Some of the comments about people wanting to watch movies on their TV’s instead of their computers is becoming outdated and will become less relevant in the future. Many people have their computers hooked up to large screen TV’s as the monitor. Newer DVD players, especially blu-ray players are starting to have a lot more capabilities than just playing DVD’s as well. Along with internet access, many of them also have USB ports so you can watch movies stored on USB drives all you want as long as you can get one with content or make one yourself.
There isn’t a compelling reason for Netflix to offer movies on flash drives right now but the technology exists at the consumer level if some company saw some additional benefits of offering movies in that form.
The issue is, though, that both methods Netflix already uses (streaming and discs) can be watched on a computer. There is not now nor will ever be a compelling enough reason for a mass-market company like Netflix to mail out flash-drives. Certainly the technology exists, and if anyone wants to send me some movies or tv episodes on a flash drive, I’m not going to turn them down. It’s just that the OP states that flash drives would be more convenient for the consumer as well as the provider, when in reality they would be exactly the opposite.
I don’t think Netflix records them at all. They buy already-made ones similar to the ones that we can buy. (I say “similar” because most of the extra features are missing.)
Not similar enough. I’ll bet the postage would be higher for the non-flat envelope.
There would be a tech support issue too. Everyone can operate a DVD player but playing a file isn’t always so simple. My TV has a USB plug but damn if I know how to use it. I stream videos from a drive to the TV through my Roku anyway so I don’t need the TV’s USB capabilities, but the one time I toyed with it wasn’t a success. I couldn’t even find what file types my TV supports on the internet.
Thanks everyone, for the information. I didn’t think of the fact that some people watch movies through their televisions instead of a computer.
But I still think that CD’s are eventually going out the same way 3/12 inch discs did.
You’re likely right, though it seems more likely to me that CDs/DVDs/Blu-Ray discs aren’t going to be replaced with any physical medium at all; it’ll all be direct file transfer via the net.
My TV, a newish one, but not a particularly expensive model. has a USB port built right into it. I can play movies off flash drives right now, without my computer being involved, and I would if they were available in this format.
My .02 cents worth, if I was going to a flash drive based model, I would do something like have a kiosk like redbox where you buy a drive, plug it into a port, and have it transfer the movies to my stick. I can go back to the "“Flashbox” kiosk to get different movies. There are several ways to flag a stick to a user account. Only allow properly keyed “Flashbox” sticks to download movies.
So then you would have to go find a kiosk to use the service? You might as well go to Blockbuster. No thanks.
I had thought it was somewhat well-known with respect to Netflix, but the big reason they can provide so many more movies on physical media is that the production studios can’t restrict what is done with a physical disc. They buy it, they can rent it to whomever they want. The Netflix streaming library is so comparatively small because the studios can restrict the licensing for streaming/“digital” distribution, and they do exactly that. In fact, it’s currently likely that the Netflix streaming library may shrink, instead of grow over time - they have to renew their distribution deals and not everyone wants to keep it up.
And yes, of course this is backward and detrimental for consumers (and Netflix itself). That is, unless the studios can provide something better, which they don’t seem to be doing.
You had quarter-inch disks? Did you ever snort those things up your nose? I can’t imagine how you wrote on the labels.
Stamping a DVD costs less than 10 cents, I’m pretty sure.
Netflix might be able to source 8GB flash drives for less than a dollar, but the costs are still not going to be competitive.
DVDs are flat and fit in well with regular mail envelopes. Not so much flash drives which will have to be a minimum of 1/4’’ thick due to the size of the USB plug. Postage would cost more.