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How Netflix built its own set-top box, and why Reed Hastings wouldn't release it

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In December 2007, Netflix was almost ready to release a potentially revolutionary device: Project Griffin, a Netflix-built set-top box that would stream movies and TV from its then-nascent "Watch Now" catalog. According to Fast Company, the roughly 20-person Griffin team was led by Roku founder and CEO Anthony Wood, and it apparently worked with Frog Design on the product's look — which at one point tentatively involved "dying the device red to look like a Netflix envelope." Testing was finished, and advertisements were being prepared for launch. Then, at the last minute, CEO Reed Hastings canceled the project.

His reasoning would fundamentally shape the future of Netflix: if the company released its own hardware, it would be seen as a competitor to the very companies with which it hoped to partner. "I want to be able to call Steve Jobs and talk to him about putting Netflix on Apple TV," Hastings said, according to one source. "But if I'm making my own hardware, Steve's not going to take my call." Despite what Wood and others call widespread excitement at Netflix — the company even produced the Lost-inspired video seen above to show off internally — Project Griffin was canned.

"If I'm making my own hardware, Steve's not going to take my call."

Though it wouldn't be released through Netflix, the device would live on. Hastings gave the project over to Roku, and it was turned into the Roku Netflix Player, which debuted in mid-2008. Netflix, meanwhile, would go on to become a linchpin of the set-top box and smart TV content market, as well as a major draw on gaming consoles like the Xbox 360. "It was totally the right decision," Wood now tells Fast Company. "[The Netflix Player] would've created tension with partners, and increasingly decisions would come up where Netflix would have to decide, 'Should we make decisions based on what's best for licensing, or what's best for our own hardware?'"