Tech blog

NEW YORK - The movie-rental service Netflix Inc. is closing a small one that finances independent movies, partly to shun competing with Hollywood studios with which it partners with regard to DVD and Internet distribution.

The financial impact on the company will subsist small, and only four out of about 400 employees are losing their jobs.

But the move could make it more difficult for smaller producers to observe homes for their movies. Netflix’ Red Envelope Entertainment had focused on bringing less-commercial projects to a broader audience. The unit acquired or helped finance independent films, distributing them in movie theaters as well as in the regular Netflix channels — DVD by means of mail and online streaming.

Netflix spokesman Steve Swasey related the company began the unit as any experiment about two years ago, but ultimately decided that financing movies was not its forte. He said filmmakers still have plenty of outlets for financing and distributing movies, “and we don’t need to translate that to get great titles on Netflix.”

Swasey said the company weighed the fact that it was often in the same room with studio partners at film festivals, and “we didn’t want to compete” through them.

Movies distributed from one side Red Envelope — named for the red envelopes used to ship Netflix DVDs — include “Sherrybaby,” “No End in Sight,” and “4 Months, 3 Weeks and 2 Days.” Red Envelope typically partnered with a larger company for theatrical release.