Fellow Fool Rich Duprey and I can't seem to see eye-to-eye lately. We disagreed on the future of satellite radio two months ago. Now we can't seem to agree on the initial success of Netflix's (NASDAQ:NFLX) online streaming feature. He thinks it's great that the leading mail-order DVD rental specialist has delivered 5 million streams since the program's inception back in January. I wasn't exactly blown away. 

Before I counter Rich's counter, I should start by conceding where I may have gone too far the first time around. I jumped at Netflix for claiming to have delivered just 5 million streams since the launch six months ago. It's the same language Netflix used in its press release, but in reality, the company began phasing in the service over the course of several months. Not every subscriber -- out of 6.8 million total, as of the end of March -- had access to the streams, like many of us did back in January.

I did note that the service is not yet available to Mac users, but I never got around to backing out an estimate of their numbers from the total paying members. I should have done that when arguing that the average subscriber has seen less than one stream of the company's instant viewing service.

"You need to factor in that Netflix really hasn't been promoting WatchNow until now," Rich wrote. That's another good point. The race to 10 million streams should take far less than the halfway point. All subscribers now have the Watch Now tab available when they visit the site (though the Mac folks still can't use it). Netflix will hopefully promote this feature to attack rival Blockbuster's (NYSE:BBI) Total Access plan the next time that Blockbuster positions its product's free in-store exchanges as more convenient.

Bang a gong, Amazon
So why am I back to rehash a pair of articles from last month? Well, I wanted to argue against Rich's claim that Watch Now is a better bargain than the Unbox service, in which Amazon.com (NASDAQ:AMZN) delivers films directly to TiVo (NASDAQ:TIVO) hard drives for viewing on television.

"[Watch Now] doesn't cost me as much as $15 per movie or $300 for a basic set-top box," Rich argues.

I'll be the first to admit that Unbox through TiVo may be costly if you don't own a TiVo in the first place. Even though entry-level boxes can be had for as little as $99 after rebates, TiVo also tacks on monthly subscriber fees. It's a great service, but only if you plan on using many of the TiVo-specific features that most DVR wannabes don't offer.

However, Rich is stretching things by pointing to the $15 price tag. That's the most a consumer would pay to actually own the purchase. Unbox rentals run between $2.99 and $3.99 apiece, with some pretty sweet promotional offers from time to time. This past weekend, you could have rented Happy Feet for just $0.99.

Unbox rentals aren't perfect. They are stored for 30 days -- either on your computer or your TiVo -- but expire 24 hours after you begin to watch them. That's clearly restrictive to those who like to watch a single rental over several nights.

Still, when you consider that the average Netflix user, paying $17.99 a month for the service's most popular plan, goes through roughly five to six discs a month, the a-la-carte Unbox rentals aren't such a bad deal.

I also love the convenience of watching from a TiVo-tethered television, instead of a tiny computer monitor. Sure, one can lug a Wi-Fi laptop or computer system out to the living room, buy the appropriate cable to play video on your television, and hook up an audio system to your computer, but I think that the last thing anyone's home theater setup needs is even more cables.

Convergence is coming
Tomorrow is coming a lot sooner than we think. Netflix CEO Reed Hastings often refers to digital delivery as an eventual mainstream service -- something that's still several years away. But he's been saying that for several years now.

Tomorrow's fast approaching -- but not that fast. If even Apple (NASDAQ:AAPL) is having a problem with its AppleTV video-streaming gadget, I doubt the DVD will go extinct anytime soon. However, Netflix and Blockbuster need to be ready for the inevitable day when optical discs feel as odd and outdated as music CDs are becoming.

At that point, let's hope that Netflix is delivering five millions streams a day.

The saga, in a nutshell:

Netflix and Amazon.com are recommendations for Motley Fool Stock Advisor newsletter subscribers. Find out why with a free 30-day trial subscription.

Longtime Fool contributor Rick Munarriz has been a Netflix subscriber -- and shareholder -- since 2002. He also owns shares in TiVo, and he's part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool's disclosure policy still owns a VCR.