Microsoft and Netfix made public their agreement under which the latter will stream movies to clients via Microsoft's Internet-based Xbox Live service.

The partnership between the two companies means that customers who have an Xbox 360 console attached to their TVs can download Netflix movies without paying extra if they are subscribers to Microsoft's Xbox Live Gold service and to Netflix.

The two firms announced in a joint statement Monday that the service will launch in the fall and will offer more than 10,000 movies and TV shows which customers will be able to view at once. John Schappert, Microsoft's VP for interactive entertainment, said in the joint statement that, after the service is launched, watching movies at home “will never be the same."

The service could hurt Sony’s recently-launched video service – The PlayStation Store. The Sony’s service carries movies and TV shows from Sony, Apple's close partner Disney, as well as Fox, MGM, Paramount, and several other studios.
 
Microsoft and Sony’s recent efforts put more pressure on Apple TV, a service which has struggled to get a piece of the pie but has been consciously talked down for its role as the "fourth leg" in Apple's product lineup. Meanwhile, both the PlayStation 3 and Xbox 360 have sold millions of units while offering media playback only as a secondary feature.

Customers with both an Xbox Live Gold subscription and a Netflix account will have the option to stream movies and TV shows from the provider's Watch Instantly online service. They won’t have to download the video, but will still have the option of pausing and skipping through content.