This was actually not true, and it was not true in a way that bothered me until I understood it a little better. Further, it was not true in a way that leads me to believe that it was difficult for me to notice the not-trueness because it reflects poorly on me.
I _do_ watch DVDs I get from Netflix. Some DVDs. I'll turn them over so damn fast I was getting 3 DVDs a month so I could guarantee there'd be one to watch most days. But the only time I watched DVDs was when I was churning through back seasons of a TV series (Stargate SG-1, Bones, NCIS, Eureka, Warehouse 13, Psych, season 1 of Hawaii Five-O -- the original -- and probably something else that I've forgotten but very similar to the above). The last time I was picking up new TV series, I experimented with streaming access to TV series, and concluded that I was okay with paying up to a few dollars per episode (on the order of $30 for a season) to get them more or less instantaneously -- even if I could get them through Netflix on DVD for what I was paying already for subscription and therefore "free".
Whenever the DVDs from Netflix were things like (most recently) _Up_, or _Dr. Horrible's Sing-Along Blog_, or a documentary, they'd just sit there. For months. It really would have been cheaper to buy the DVD on Amazon and shelve it unwatched. I knew that, but I did it anyway, because I already hate the accretion of physical media in the house. Netflix's best attribute was that when I sent them back, they were _gone_. Streaming video offers the same attribute, with the added fillip of no delay, so whatever caused the impulse to get it surfs me into watching it -- and I don't feel tempted to buy it for "later", when I "should" want to watch it.
"The queue was a great way of putting together a list of movies you really wanted to see, and then going through them slowly, at your own pace. Sometimes certain movies weren’t available, but that was OK — there were always other movies that were available, and you knew that sooner or later the ones that weren’t available would show up."
I can't speak to whether this blogger ultimately watched the videos in his queue or not. What I do know is that the queue was a way for me to stack up "shoulds". And my character is such that I just don't actually execute on "shoulds" when it comes to entertainment.
"The wonderful long-tail qualities turn out to have been an incidental benefit more than a core value proposition."
I'm not sure that this is a fair statement; I think Netflix has a lot of data on how their customers use their videos. When Netflix sees someone hanging onto a DVD for six or more months, they have to be sure that person isn't watching that video. But when someone returns a video a day after they get the video and asks for the next one in the series, they can be reasonably certain that person _is_ watching that video. Their ratings systems is icing. If I were Netflix, and I noticed that some interesting fraction of my customers behaved the way I do (speculation -- but I'm kind of a second rank sheep. When I'm baaing as I move in a particular direction, I can reliably look around and see a few sheep in front of me and a whole lot more right behind me), I'd rearrange my business so people like me didn't sporadically watch videos, interspersed with months of not watching videos. I'd try to figure out a way to keep me supplied with the kind of videos I _want_ all the time, everywhere, without any delay to let that spark of video-watching interest flicker out.
There's some reason to believe that even the blogger quoted above is Just Like Me:
"I just don’t watch that many movies" and, further on, "serious-and-earnest Netflix DVDs tend to pile up unwatched when the whole reason for wanting to relax with a movie in the first place is because you’re frazzled and just want to kick back with something funny or brainless." I don't think badly of Felix Salmon for being this way; maybe I should ease up on myself for being this way.
If Felix Salmon was still going to the video store for light entertainment when his long tail choices from Netflix were too heavy for his mood of the moment, then streaming (once over the hump of figuring out how to use it) is a Killer App.
I think, in the end, the long, sordid history (cinema, ventriloquists on TV live, movies on television, new programming on TV, reruns of TV programming on TV, cable, premium cable, pay per view, VHS/Betamax, DVD, Blu-Ray, etc.) of sound-and-moving-picture entertainment is trying to monetize showing us something we enjoy watching when we want to watch it. We'll watch something not quite right if it's really, really easy. We'll work to get what we want if the amount of work is appropriately scaled to the improvement in is-it-what-we-want. But we don't want to work to get something that we should want -- and we don't want to sit through something we shouldn't be watching if we don't enjoy it.
The rest, in the end, is splicing endless options. Right at the moment, streaming is looking tremendously promising in part because it can leverage all the work that broadcast and cable television programming has done (that would be me, churning through DVDs from Netflix and, now, paying $1-3 an episode to watch "free" TV). There will be something else in a few months or years.
ETA: I should add that Netflix could probably even tell you a time of year I was most likely to watch a bunch of DVDs. I can only speculate, because I don't keep records, well, not good ones. My usual television is on hiatus -- altho Eureka and Warehouse 13 have started up again -- leaving me at loose ends. I've caught up on Rizzoli and Isles and am working my way through Castle. I doubt I'll be feeling a need for multiple seasons of multiple shows this fall, when I'm back to watching ridiculous amounts of new television as stored on the Tivo.