tonight on "nightline." no late fees. that little red envelope means movie magic at home for millions. we take you behind the scenes at netflix, the company that might just wipe blockbuster off the map. and, queen of new media. she's rich, she's powerful and she did it her way. we step inside the fascinating high speed world of arianna huffington. once the butt of washington jokes, no one's laughing now. plus, let's eat. on this high holiday of gastronomy, we offer our gratitude with a thanksgiving day edition of the "nightline" plate list. >> announcer: from the global resources of abc news with terry moran, martin bashir and cynthia mcfadden in new york city, this is "nightline," november 26th, 2009. >> good evening, and happy thanksgiving. americans from coast to coast celebrated today with turkey and all the fixings, as did president obama and his family at the white house. the president is poised to announce his plan for afghanistan next week, and troops there today commemorated the american holiday with a traditional meal, though far from family and friends. as did their counterparts in iraq. their work continues. back at home, the holiday season punishments many people in the mood for a movie, which brings us to our first piece tonight, a look at netflix, the company that's delivered more than 2 billion disks to its mebls and been unfazed by the economic downturn. but what's next? can netflix avoid blockbuster's fate? john donvan took a look. >> reporter: strolling to the post office to cast into the roaring river of the mighty american mail system this, a netflix envelope. a bit of magic, depending on how you look at it. tucked inside was a movie on a disc, and movies are magic, right? even if this one, the 2008 romantic comedy "forgetting sarah marshall" was a bit of a chick flick -- >> oh, god, i made her kill herself. >> reporter: see what i mean? >> i like anything with paul ru rudd. >> reporter: and that, by the way, is "nightline" producer elizabeth stewart, the last person to actually have watched the disc in my hand, because she rented it. and people renting movies and mailing them back and sometimes reviewing them, simple is how netflix makes a fortune, even in this economy. and that's magic, right? but back to the post office, and, what would happen if i wrote a note inside the inside envelope. hello from "nightline." i pork it up again and go forth to cast it into the american mail system. what magic might come of that? well, we would just have to see. but first, we have to get up early. 3:00 a.m. every day this place comes alive, hubs of hands opening hundreds of thousands of envelopes like that one i put in the mail. this is the inner chamber of the hardware side of netflix. all under one roof, stretching all the way back to where the company spokesman showed me this. i'm seeing ahead of me a world of hundreds of thousands of discs. >> millions. we have millions. netflix has about 46 million dvd inside the catalog. >> reporter: that's right. 46 million. not all in this center, and we were near san francisco. >> we have 58 of these centers in the u.s., and we distribute the storage to all of those, so, this is replicated in little rock, arkansas and boise, idaho. >> reporter: every disc checked for scratches and then checked into the computer. soon to be back out in that same day's mail to the 10 million customers, including the near three quarters of a million who only signed up in the last half year. ree hastings invented this company that's doing so well in times that are so bad. one of the theories behind that is people want to stay home and netflix is a championsheap date. >> it's a scary and unpredictable time. we knock on a lot of wood. >> reporter: when netflix was born as a dot com baby, the buzz wasn't about the movies, it was about the interface. >> how can we do a better job through personalization, through social media, to help you watch of the 100,000 movie titles, more of the movies you're going to love. >> reporter: not that it worked perfectly at first. >> the first day it was chaos, you know, printing out things, packing slips and the dvds, we only had 500 title, and we shipped the wrong dvd to people. >> reporter: who was your source of dvds in the beginning? >> very early it was best buy. >> reporter: seriously? >> absolutely. >> reporter: they must have loved you. >> they did. >> reporter: but netflix also had enemies, chief among them blockbuster. which owned the video rental market this way. >> and this is due saturday by midnight. >> reporter: and which set out to destroy netflix by copying it. but obviously netflix is not dead. and block buster ended up saddled with debt. why didn't they kill you off? >> blockbuster had to struggle with that billion dollars of debt that whole five years until now and today they are struggling from that debt. >> reporter: it's now about 7:00 a.m., and most of the workers are going. automation is taking over. this array of machines can address 300,000 discs an hour, and sort them by zip code, postage paid by netflix. what is your post stage bill? >> about $300 million a year. one of the largest first class customers for the united states postal service. >> reporter: are you carrying it for us? >> just a good customer. >> reporter: well, for now anyway, because some day, and it has begun already, most, if not all of netflix customers will be getting their movies not by mail, but over the internet. do we see a day when netflix is all about direct streaming into your home and the dvd is totally out of the picture? >> not for a long time. years and years. we think our dvds through the mail business will continue to grow for five to ten years. >> dvds today are so -- people have them in their car, they have portable dvd players, they are in every pc. they are just incredibly useful. >> reporter: and so it is still an ocean of dvds. and we wondered, where in that ocean was the disc we had mailed the night before? well, this told us it had already arrived back at netflix, e-mail sent to our producer at 6:16 a.m. confirming netflix had it. but where was it now among these hundreds of thousands of discs flying in and out the door. could netflix's system find it? >> there is our little note. >> reporter: hello from "nightline." our message in a bottle. and here's the really amazing thing. that disc was already flagged for someone else. so it's out there now, somewhere, our message in a bottle, and if it comes your way, well, hello, from us. i'm john donvan for "nightline" in california. >> ah, the fast traveling movie. when we come back, she is the power player in new media and she did it her way. we sit down with arianna huffington. if you've taken your sleep aid and you're still fighting to sleep in the middle of the night, why would you go one more round using it ? you don't need a rematch-- but a re-think-- with lunesta. lunesta is different. it keys into receptors that support sleep, setting your sleep process in motion. lunesta helps you get the restful sleep you need. when taking lunesta, don't drive or operate machinery until you feel fully awake. walking, eating, driving or engaging in other activities while asleep without remembering it the next day have been reported. abnormal behaviors may include aggressiveness, agitation, hallucinations or confusion. in depressed patients, worsening of depression, including risk of suicide, may occur. alcohol may increase these risks. allergic reactions such as tongue or throat swelling occur rarely and may be fatal. side effects may include unpleasant taste, headache, dizziness and morning drowsiness. stop fighting with your sleep. get a free 7-night trial on-line and ask your doctor about switching to lunesta. discover a restful lunesta night. jeep. knowing reality isn't captured by a hidden camera. it doesn't come in episodes either. you see i don't live to live through anyone ever. so while everyone waits to see the next best this or an unbelievable th here's the reality. there's no rerun when your living in the now. so while you tune in i'll be somewhere getting out. i live. i ride. i am. jeep. there is a lot of hang wringing in the journalism business these days. what with newspapers closing across the country, and television viewership shrinking, into these times steps a woman on a mission, about unlikely savior, perhaps. a self-made force of nature. her name, arianna huffington, who believes the internet, in particular, her baby, "the huffington post" with its 20 million unique visitors a month, may save the day. he first caught up with arianna huffington, the controversial queen of new media in washington, where she was to testify before congress about the death of newspapers. >> but the discussion needs to move from, how do we save newspapers to, how do we save and strengthened journalism, however it is delivered. >> reporter: according to "the washington post," she is one of the accused killer. a charge she flatly denies. >> if "the huffington post" did not exist, the newspapers would not have fewer problems. >> reporter: so it's not your fault? >> it's not our fault. >> reporter: no surprise, she believes her website, "the hutching on the post" can help save news, not destroy it. she is certainly generating a lot of attention. a long way from her rather humble greek origins. she's now a washington insider, whose blog site wields pret s tremendous power. >> last month, we had 20 million visitors. >> reporter: 20 million? that sounds like a lot of money to go with a lot of conversation. is it? >> the advertising has been really good this year. i'm a greek peasant girl. i don't -- i don't boast about anything. >> reporter: i don't know. of all the descriptions of you, that doesn't seem to fit quite right. >> actually does. there is a foundation of greekness that is really important to me, and i've never been able to lose my accent. i tried it, but then, i realized it was a hopeless battle. >> reporter: one of the few battle s this self-made feisty woman has ever lost. imagine, arianna at 17, growing up in athens, in a modest, one-bedroom apartment with her mom and sister, and deciding she wanted to go to one of england's most prestigious universities. came bridge. >> i saw this picture, and i said, mommy, i really want to go there, and everybody, including my father said, don't be ridiculous. you don't even speak english. >> reporter: did you not? >> no, i spoke french because it was the official foreign language of greece. and i said, okay, if you want to go there, we'll find occupant how you can go there. >> reporter: and she went. becoming not just a student, but a star. crediting her mother. >> she had such a capacity for intimacy. people sensed they could trust her and it didn't matter to you if you were the british prime minister or the plumber. >> reporter: both of whom have been to your house, no doubt. >> i've actually happ lly had tn one day. i was dating an english member of parliament, he brought the prime minister, and the plumber had also come because there was a problem in the kitchen and the plumber was in the kich p and was complaining about the prime minister to my mother, and my mother said, let me go bring him here, you can sit down and tell him directly. >> reporter: the yellow brick road to fame and fortune has had its share of potholes. over the years, huffington has been accused of any number of things from abandoning her principles. she was once a conservative republican who is now a liberal republican to being a gold digger, supposedly marrying michael huffington, who became a congressman from california, for his money. the couple divorced in 1997 after two children. you have certainly lived through every insult, i think it's possible, to sufficienter in private or in public. in "the washington post" in 1996, it says, "if it were a crime to make fun of arianna huffington, the most of washington's elite would be in prison or halfway houses." i mean, you were the most upwardly mobile greek, you were a gold digger. did it hurt? >> well, i didn't believe in barricading myself against being hurt by things, but letting it in and letting it out quickly. >> reporter: so tell me how that works. >> it works really well right now. >> reporter: okay, good. so you let yourself go with it and be really hurt and mad, whatever -- >> and i can honestly say now there isn't any human being alive that i have a grudge against. >> reporter: wow. >> and i feel that's a very important thing in life. holding onto grudges, it's really poisoning ourselves. you know, one of the things that i learned from my life is how often things that you really want, but we don't get, lead to the best things in our lives, and in my case, my first big love, bernard levin was twice my age, he didn't want to marry me, he didn't want to have children. by the time i was 30, i decided to leave him. i didn't trust myself to stay in london, so i moved to new york, and really -- everything that happened in my life because a man wouldn't marry me. otherwise, i would still be there, probably. >> reporter: hard to imagine her living in anyone's shadow. now 58, hutching on the's name is a housewould one in much of the country, not just for the celebrity blogs on her site, but for the real reporting there. the site now employs a half dozen reporters and hiring a team of investigative journalists, with an infusion of $1.5 million. >> i hope we cannot just save investigative journalism but strengthen it. i think it's amazing that journalists missed the two biggest stories of our time. the lead-up to the war in iraq and the economic meltdown. >> reporter: those are fighting words, of course, in the journalism community. >> well, we did miss them. and sure, there are exceptions. the blog team. drum roll, please. >> reporter: she takes us for a tour of the news room in new york. >> they deal with the bloggers, right? they look the most beaten down. they look the least happy of anyone in the room. why is that? >> they deal with all the blogs that said, i sent you my blog seven minutes ago, it's still not up on the site. >> reporter: meanwhile the white house seems to acknowledge the site is coming of age. president obama called on its reporter at his first press conference. >> sam, huffington post. where is sam? >> thank you mr. president. >> reporter: how involved is huffington herself? >> it's like an eagle eyed editor. it's remarkable. sometimes i'll follow stories at 11:00 at night and i don't think anyone's going to get them except for the night editor and arianna will say, this should no be there, there's, the comma -- >> reporter: are you serious? she's paying that much attention? >> she is a shark editor. >> i think i have a copy editor's brain. >> reporter: well, and a work a aholic's sometime schedule. >> i really love it. i have to sort of make myself put my blackberry away. >> reporter: no, no. not blackberry. how many are there? last count -- >> i'm down to two. >> reporter: but there were three. >> there were three. i'm down to two. and at night, the blackberry is charging in a different room from the room i'm sleeping. >> reporter: but it's all material. even the search for more balance in her life is making its way onto the site with enhanced lifestyle sections like unplug and recharge. huff post is four years old. ten years from now, what will it look like? anything like it does today? >> well, if i can really predict what the post will look like ten years from now, we're going to be missing something, because all the best things that happen, all the innovations that have happened are not really predictable. >> reporter: but you can be sure that the woman that still calls herself a greek peasant girl will somehow be in the middle of it. blazing a trail not holding a grudge, arianna huffington. when we come back, it's the perfect night for the when we come back, it's the perfect night for the thanksgiving plate list. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i'm challenging my husband... that'll be me. like me. like her. and he likes to drink a lot f coffee. for a whiter smile and a fresh breath feeling that... 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