June 9 (Bloomberg) -- Netflix Inc. customers purchased all of its set-top boxes for streaming movies from the Internet to television sets on stronger-than-forecast demand, Chief Executive Officer Reed Hastings said in an interview today.

Netflix, the largest U.S. mail-order movie service, is pressing supplier Roku Inc. to increase production, Hastings said. He wouldn't say how many of the players the company had. The $100 system lets customers order movies online and watch them on a television using Wi-Fi technology.

Netflix, with 8.2 million subscribers, will recover its investment in the service by cutting postage and marketing costs, Hastings said. Five million to 10 million people should have access to the service by next year, Piper Jaffray & Co. analyst Michael Olson said in a report on June 5.

``The Roku device is the first step in a real revolution,'' said Hastings, 47. The company's goal is to make the Netflix service ``ubiquitous'' on a ``wide selection of devices'' by 2010, he said.

The company is working with three other consumer electronics manufacturers to build Netflix software into products such as DVD players and game consoles, Hastings said.

``The long-term payoff in 2010 will be increasing subscribers and earnings per share,'' Hastings said.

The new service should help Netflix, which distributes movies through the U.S. mail, expand internationally for the first time, Olson said.

Roku, a Saratoga, California-based startup, is moving to increase production, Hastings said. Netflix unveiled the service on May 20.

Six-Week Backlog

Roku's backlog will take six to eight weeks to clear up as more units arrive from Asia, company Vice President Tim Twerdahl said today in an interview.

One prospective Netflix partner is believed to be Microsoft Corp., which would adapt the Xbox game console to show streaming movies, said Jason Avilio, an analyst at Kaufman Bros. in San Francisco, who recommends holding Netflix shares and doesn't own any. Hastings is a Microsoft director. He declined to comment on any talks with Microsoft, saying the other partnerships will be announced in the second half of the year.

Netflix fell 69 cents to $31.13 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have gained 17 percent this year.

To contact the reporter on this story: Tim Mullaney in New York at Tmullaney1@bloomberg.net.

Last Updated: June 9, 2008 16:44 EDT