Pure speculation here, but I'd bet that this is a direct response to Hulu's price drop in Hulu Plus when opening to the general public[1]. The selection on Netflix is better (well, larger at least), but unless they can at least match the streaming delays that Hulu has, i.e. days vs. seasons, I don't see them winning the online only battle.
It is worth noting the device support advantage, however. Netflix has a well established list of supported devices. This makes it much more convenient than Hulu for the average person, particularly with the amount of households that own a Wii and the relatively low price point of the Apple TV.
It is worth noting the device support advantage, however. Netflix has a well established list of supported devices. This makes it much more convenient than Hulu for the average person, particularly with the amount of households that own a Wii and the relatively low price point of the Apple TV.