Netflix reeling from outage

Online video service Netflix is still attempting to recover from an outage that left the company unable to ship DVDs to millions of subscribers.

Netflix first began reporting the problem on Tuesday, notifying customers that an issue with its computer systems would leave the company unable to send out confirmation of returned discs or send out new orders to subscribers.

The issue continued into Wednesday, with the company able to get some of its distribution centres online and shipping out orders. However, much of the system was still unable to function correctly.

As of Thursday morning, about half Netflix's distribution centres remained unable to send out orders. As compensation, the company is offering affected users free credit for the service.

"We were able to ship some DVDs from about half our distribution centres yesterday but we haven’t yet been able to resume shipping this morning," Netflix head of operations Andy Rendrich said in a blog posting.

"We’re as frustrated about this as you are and we once again apologise for the inconvenience."

Some customers, however, were not thrilled with the company's handling of the situation, as Rendrich's blog posting was peppered with comments from subscribers threatening to move to rival video services.

The issue does not affect the company's streaming video service, which is offered free to all subscribers.

The outage comes at an inopportune time for Netflix, which was hoping to use its dominant position in the video-rental sector to make a move on the streaming video market and go head-to-head with such names as Apple and Sony.

The company had most recently inked a deal with Microsoft to provide video streaming services through the Xbox Live console service.