In my last post I sort of touched on the popularity of streaming video. It is increasing to the point where many researchers, such as IHS Screen Digest, are saying it will surpass DVD and Blu-ray use within the year.
One reason for this new trend is because streaming movies online on services like Netflix or Hulu is easier for most people, rather than using the physical media of a DVD. Another huge reason is because streaming online is cheaper than buying or renting the physical copies. According to IHS’s research, you pay $0.51 per movie while streaming and $4.72 when you physically purchase a video. This can only help Netflix gain more movie licenses to show on its streaming services.
You may have noticed that Netflix streaming is very limited when it comes to newer, bigger budgeted films. But with the majority of viewing being done on Netflix’s Watch Instantly service, they stand to gain more in negotiating licenses with movie and television studios. For the studios, this is not a good thing, because they will be losing more and more profit to Netflix while physical copy sales decrease. The studios will probably add incentives to buying Blu-ray discs, maybe with added features.
Another thing studios have done is created a cloud streaming service called UltraViolet. When a consumer purchases a Blu-ray disc they get a code that allows them to add that movie to their digital library, viewable (streaming from the cloud) on multiple devices as long as they have a UV account.
DVD and Blu-ray sales will most likely continue to see big profits for the foreseeable future. Netflix instant streaming capabilities and ‘the cloud’ are still unknown to a portion of consumers. A way for Netflix to get the word out would be to have a Facebook app that shares what you and your friends are viewing. But this isn’t available in the U.S. currently because of an old video privacy law.
Another tell-tale sign for streaming video’s rise is that Netflix is funding a new season and movie for the previously cancelled cult hit “Arrested Development”. Up until recently there were talks that Netflix would also revive Fox’s drama “Terra Nova”. Those hopes are now dashed as The Hollywood Reporter and other sources have denied these claims.
While I believe streaming video to be the future, physical copies will never die out completely. It’s not only video that is being streamed; music and even video games have begun being streamed online.
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