Netflix drives customers to piracy by delaying new releases
Greetings Readers!
With the exception of when they raise prices, everybody seems to have a major love of Netflix, myself included. Unfortunately, I think that love affair is about to come to an end. It was announced today that Netflix has decided to let the greedy people over at Warner Bros. keep Netflix from renting new DVD or Blu-ray releases until 28 days after their release. So much for Netflix's willingness to stand up to the buffoons at the movie studios.
In exchange for this stupidity, Warner Bros. will open up more of its catalog of movies to Netflix for streaming. I don't suppose that is the worst trade-off in the world but it certainly hurts many Netflix customers who use the service to check out new movies as they come out. For the customers that don't do any streaming from Netflix, there is no upside to this deal. If these deals catch on, not only will it hurt Netflix subscribers, but Netflix itself. Currently, 30% of Netflix's rental business is new releases, something that this will really cut into. Hopefully they won't bend over to any other studios if they want to keep that number from going down. While this appears to be a big win for Warner Bros, I believe it will come back to bite them.
Warner Bros. stands to make a lot of money off of this deal. A large chunk of the money made from a movie's DVD/Blu-ray sales are made in the first month of release and by taking out a large chunk of the rental competition in the first month, Warner Bros. expects sales to increase considerably. I, on the other hand, am not so sure of this. As a usually happy Netflix customer (except when they increase Blu-ray rental fees), I almost never buy DVD or Blu-ray movies anymore. If there is a great sale on Amazon, then I will buy something but otherwise, if I can't find it on Netflix, I can find it on <insert bittorrent site here>.
This is exactly what many other people are going to be doing as well. If they can't get a movie from Netflix, they won't want to waste their gas going to their local big box store in hopes that they will have the new movie that they want to watch in stock. Owning the movie is nice, but unless you know you want to watch it all the time, it makes no sense to buy it when you are already paying for a Netflix subscription. Paying $20 for a movie when you should be able to rent or stream it is insane. This is the point where most people will have the thought that going to a bittorrent site and getting the movie the night you want to watch it for free is a lot easier, cheaper and more hassle free than going to buy the movie at the store. The fact that Warner Bros. doesn't understand this just shows what kind of idiots they have running the company.
In this decade, content producers need to focus on putting their content everywhere and make the money they can instead of putting it only in a few places because all that is going to do is drive more people to piracy.
Netflix, stand up for your customers, not the fools at the movie studios!
Amazon’s VOD success depends on distribution deals
Greetings Readers!
The streaming video market has become rather crowded in the last couple of years with services like Hulu and YouTube, but the video service with the most potential is Amazon's VOD service.
Amazon's VOD (Video On Demand) service has been around for a while and has a huge library of tv shows and movies including some of the newest releases yet it has never gained much traction in a world dominated by Netflix. If Amazon hopes to really compete in this market, it needs to do more than advertise its service (which it doesn't do a very good job at anyway). Amazon needs to through its weight behind the service and make sure that everybody is aware of it and it is accessible as possible. How can they make it accessible? Amazon needs more distribution deals with hardware manufactures.
Amazon currently has deals which allow its service to be accessed on Roku boxes, Panasonic Blu-ray players, TiVo DVRs and Sony Bravia TVs, but they have to do much better than that. Amazon needs to push for a deal with every TV manufacture instead of just Sony and their Bravia line. With many people upgrading to new and better TVs after the DTV transition to take advantage of the new HD content, there is a huge opportunity for Amazon if they work to put themselves on all internet connected TVs. Same thing with Blu-ray players, Blu-ray is starting to gain traction and Amazon needs to do its best to get on more than just Panasonic players if it wants to get in on the ground floor before the mass exodus from DVD to Blu-ray begins. As far as TiVo goes, that is a great move for them but they should also work towards being on the DVRs offered by cable and satellite providers.
Amazon has the huge opportunity to grab a huge chunk of the streaming video market if they are willing to do what is necessary to put their service in front of as many people as possible. They have started moving in this direction, but so as Netflix and others, so if they want to put themselves in a dominant position, they must act now!
Finally, I think they need to go mobile with their video on demand service. Apps for the iPhone, Android, Windows Mobile and such should be coming too. Many people like to watch videos on their phones, so if you have a way to stream videos to a phone, even if it is over wifi, you are ahead of the competition.
The competition in this space is in its very early stages and Amazon is on the position of either being left behind or taking the lead. The potential for profit is there, will they strike before its too late?
Blu-ray sales up 91% this year
Good news coming from the Blu-ray camp, sales of Blu-ray disks are up 91%. If that wasn't good enough news, standalone player sales are up 25%, bringing the total number of blu-ray playing devices in the US (Including the PS3) to almost 11 million. The sad thing is that half of that number is PS3 consoles instead of a bunch of standalone players which are getting cheaper all the time. 
By itself, that number sounds significant until you realize that there are 260 million DVD players floating around not counting the ones built into computers and I doubt even counting the ones in game consoles. Eventually Blu-ray will likely catch up but not anytime soon at the rate they are going.
I have always stated that the problem with Blu-ray is price and lack of advertising and I still stick to that. As long as Blu-ray movies are 3 times what you can buy a DVD for and players are above $75, they will fail to see big numbers. Also, there needs to be more of a push to show consumers why Blu-ray is so much better. The only advertising for blu-ray I have seen is in a movie theater. If the companies pushing Blu-ray address these two issues, they will soon see a big move in the right direction, otherwise DVD will be hanging around for a long time. [via Electronic House]
Sony Announces Blu-spec CD, Another Format for a Dying Medium
Greetings Readers!
Yesterday, I wrote a post about how CD sales are down and Walmart is reducing the floor space it gives the CD. Clearly, the fools at Sony don't agree with my assessment of the CD and its impending death. Sony has now announced a new CD format, Blu-spec CD. This format is going to be dead before it even has a chance.
The new format is said to be backwards compatible with current CD players, so you will be able to play the blu-spec CDs in the CD players you already have, but what is the point? Are people really going to pay the higher cost of a new format when what they have works just fine and can play the same music, often at a better quality than the digital music that many people listen to now? Sony touts the new Blu-spec CD players will eliminate vibration and therefor make music quality better. When people are generally satisfied with compressed mp3 quality audio, do we really need something better than existing CD quality? I don't think so.
No prices have been announced for the music or the new players, although 60 titles will be available by Christmas. I certainly don't expect the prices to be cheap. Prices for new formats never are. The new technology will use the same Blue Laser Diode as Blu-ray, so from that alone, you can assume it will be quite expensive, especially when Blu-ray players are still running in the hundreds of dollars. With consumers moving in mass to digital downloads for their music, spending a large chunk of money on the new format of a dying medium makes no sense. Somebody needs to relay this message to Sony so that they stop wasting money trying to develop these formats, only to have them die right out of the gate.
While I will always love the CD and listen to it every time I am in my car, with sales down around 23% this quarter, it is not worth investing in a new format when the existing format is quickly dying out to something far more convenient. Sony would be better off to create their own store to compete with iTunes and others in the digital download space rather than to create a whole new format that is truly unnecessary.
The world is moving to digital downloads Sony, get on board and stop trying to keep the past alive!
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-Jeremy "pcnerd37" Bray
Walmart Signals the Death of CDs/DVDs, Looks to the Present and Future
Greetings Readers!
For the past month, maybe more, the local Wal-Marts have been undergoing a major shift. Nearly everything but groceries have changed their location. There are now more groceries, less pet supplies, and the electronics department has roughly doubled in size. Apparently this shift is taking place across the country. A post on Gizmodo today revealed a change in business at Wal-Mart when it comes to consumer electronics. It seems they are cutting back on CDs and DVDs to focus on other products such as Blu-ray.
With CD sales down, digital downloads through the roof, and Blu-ray hoping to replace DVD, such a move was destined to happen at some point, I was just starting to wonder when. With digital downloads exceeding many peoples expectations, it is a matter of time before the CD becomes just another dead physical format. With stores such as Walmart, Circuit City, Best Buy and others still promoting the latest music in CD format, I had honestly started to wonder just when digital downloads would kill the CD. I have known for some time that it was coming but haven't seen any sites of a death anytime soon, until today.
With CD sales down 23% just this quarter for Walmart, it is no surprise that they have now started to take away floor space from the CD and even the DVD to give more room for video games, various consumer electronics such as the iPod and Zune as well as Blu-ray. Such a move is a sign of the times and that death for the CD and DVD formats is nearing. I expect to see other major retailers follow suit in the near future. I will admit that with DVD sales still much higher than Blu-ray sales, I was kind of surprised to see this move at this time. I have long believed that this is necessary for the mass adoption of Blu-ray. When stores stop selling DVDs, people will start moving over to Blu-ray, just like they did for the transition from VHS to DVD. Blu-ray certainly has other issues that it needs to conquer before it can truly take the place of DVD, but this is the first step in the right direction.
While I agree with Walmart in their move to replace CD floor space with portable media players, that isn't really going to help them gain market share in the digital download space such much as it does iTunes and the Zune Marketplace. If they expect to see real success from this, they need to bundle a deal from their new digital download store with the devices. Walmart must give people an incentive to buy music from them before the customer becomes addicted to iTunes or other download service. If they did this, they would see huge growth in their new MP3 store while slowing the growth of their competition.
This is a clear sign that these formats are soon going to go the way of the formats that came before them. While the CD and DVD still have some life in them, if other stores follow suit and this falling sales trend continues, I can easily see the death of the CD within the next 2 years, and the death of the DVD within the next 5 (likely less).
Long live the extremely expensive Blu-ray!
-Jeremy "pcnerd37" Bray
Blu-ray Needs Better Marketing and Quick!
Greetings readers!
Some very disturbing number have emerged this week regarding Blu-ray and the fact that a majority of HDTV users don't even know about the format. According to NPD's latest customer awareness survey, only 45% of HDTV owners are "familiar" with Blu-ray, which is only up 10% from last year. This means that over half the people that should know about Blu-ray aren't even familiar with it! With such a small increase over last year, it is clear that the marketing behind Blu-ray is only marginally effective. If those numbers weren't ugly enough, only 9% of that 45% have any plans to purchase a Blu-ray player. Out of 4 million potential customers, that is a pathetic number.
Since the end of the format war earlier this year, the amount of press about Blu-ray has dropped considerably. While this has not helped their cause, it is far from the primary cause of adoption problem that Blu-ray is facing. While I do believe that Blu-ray player price point is a large problem with blu-ray, that would only help to increase that 9% of people who know about Blu-ray and plan to purchase it in the near future. This is only part of the battle. Finding a lower price point around the $250 range or lower would do a great service to help improve that miserably low percentage, but that still does little to help the awareness problem that the format is suffering from.
Sony and the other backers of Blu-ray need a massive awareness campaign similar to that of the digital tv switchover if they expect to get the word about about their great format. Saying that a movie is coming out on both DVD and Blu-ray at the end of a commercial is not enough. Commercials talking about and showing the benefit of the format, especially on channels that broadcast in HD would be a great start, but you cant stop there. Work with stores such as Wal-Mart and Best Buy to create large in-store displays that showcase the benefit of Blu-ray over the DVD format.
Last, I believe that a solid online presence is a key to attracting many people who may be on the fence about purchasing one of the new players. When I do a Google search on "Blu-ray", the top results do not come from the group behind Blu-ray! There isn't even any sponsored ads to help point potential customers to the home of Blu-ray. By having a strong online presence, the Blu-ray association can more easily control what users see when they look for Blu-ray technology. While ads and a high search engine ranking will help considerably, they need to take advantage of word of mouth. Utilizing services such as Facebook, Twitter and others will greatly help their word-of-mouth campaign to get people talking about the format. Becoming an ally of the blogosphere would greatly help as well. It is better to be on the good side of the blogosphere than its bad side.
Those are just a few ideas that would greatly increase the adoption rate of Blu-ray and avoid the problem of many customers skipping over the format because they don't think they need it.
If the Blu-ray backers can market the format properly, they will see great success. If they don't, they will see very slow rates of growth and will lose many potential customers.
-Jeremy "pcnerd37" Bray
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