Netflix CPU usage maxes out and causes video to lag

I've been having some serious problems playing netflix on my computer using any browser (Firefox, IE9, or Chrome). At first the video will play fine and my cpu usage remains below 20%. Then within about 1 or 2 minutes my cpu usage will jump up around 70% to 100%. The task manager shows the majority of the usage is by whichever browser I'm currently using. When the cpu usage jumps up the video begins to become choppy and starts to lag the audio and it becomes worse and worse. Sometimes this would cause the computer to completely shutdown and give me the Kernal 41 power failure with a bug report of all 0's. I have a consistent internet connection at around 15 m/b down. Also I am able to watch 1080p videos on youtube without any problem.

Computer specs:
Asrock H55M motherboard
Intel i3 processor
2x2 G Skill DDR3 RAM
64 Gig Samsung SSD
2 Tb Samsung HDD
430W Corsair PSU
Windows 7 Enterprise x64 Service Pack 1

This computer should be able to handle Netflix streaming with ease. My 5 year old Dell laptop plays Netflix streaming hd flawlessly using the same wireless connection. I've updated all my graphics, sound, and BIOS drivers. I use Microsoft Security Essentials as my antivirus. I've already ran the Windows Memory Diagnostic and Memtest86 and everything checked out fine. I've had this system for about a year and a half now and the problem started just recently but I cannot isolate a program/driver that is at fault. The fact that I'm able to stream youtube fine makes me lean towards Silverlight being a problem.

Any help/suggestions would be greatly appreciated. I've been troubleshooting this for the past week to no avail.

It could very well be a silverlight problem. Have you tried uninstalling and reinstalling the latest Silverlight plugin? Are you running any codec packs?

Yes I've tried uninstalling and reinstalling the silverlight plugin several times. I have not installed any codec packs (I just use VLC to play any media files since it supports just about anything without the help of codecs). It just seems strange that the netflix show will play fine for a minute or two with a very low cpu usage and then the cpu usage spikes up and causes the video to lag behind the audio. If I refresh the page it will work again for a couple of minutes but the problem repeats everytime. And the process in task manager responsible for the bulk of the usage is the firefox plugin container. If I use IE9 it is the IE9 process which eventually spikes up which makes me think the plugin is not playing nicely with some driver.

What version of VLC do you have?

I'm not positive but I think it's the latest version. I'll give you the specific number when I get home from work.

The latest version is super buggy. I would uninstall and downgrade to the latest 1.x version and see if that helps/fixes the issue. I upgraded to 2.0 and noticed way too many bugs with it, as have others, so I downgraded.

http://download.videolan.org/pub/vid....1.9-win32.exe

Ok I'll try that, but how would that be affecting streaming video play using an internet browser? Does VLC install a type of plugin that effects media files played from Netflix?

VLC tends to use its own codecs as standalone for the player itself and not implement them system wide. However, in version 2.0, it integrated itself into the browser to the point where it was involved in playing every type of media file, which I did not like. And, there was no way to prevent it from doing so. This is the reason I reverted back to version 1.x. I didn't like the forced integration with the new version, which could be causing some issues with this. Even if it's not, it's worth a shot. In the thread below, it helped a user to uninstall VLC (but obviously YMMV):

WMC freezes at end of Netflix episodes

Tried uninstalling VLC player which didn't change anything. Turns out I was still using an older 1.1.xxx version number. I'm going to go through and try uninstalling programs one by one to see if I can get any results.

You might try installing incrementally older versions of Silverlight as well to see if that could help.