You can’t have a good format war without some fallout. With the fall of HD-DVD, the question has been raised regarding Netflix’s ability to sustain its subscribers and demands for the Blu-Ray Format. Netflix said today that its subscriber count will be 3% higher than forecast because of price increases from Blockbuster and cheaper online advertising rates. Of course, the raise in price led to a loss of thousands of subscribers for Blockbuster, many of them switching or even returning to Netflix.

NetFlix CFO Barry McCarthy recently revealed, in an interview with Video Business, the company’s plan to quadruple their Blu-ray selection from 400 to 1,500 titles. As you might have guessed, he hinted that they might raise fees for monthly subscribers.

“It seems apparent that content will cost us more,” McCarthy said. “Whether we raise prices will be entirely a function of churn, subscriber acquisition costs and gross margins.”

McCarthy also hinted that rumors about Netflix joining forces with Microsoft to offer movie downloads may be true.

[Video Business] VIA [Slashgear]