Dub Dynomite

I’m not sure if Netflix(or should I say Quikster?) is worried about losing DVD rental subscribers. I think they may be angling to get out of the DVD-by-mail business, eventually. Netflix has a bigger battle to fight, and that is with their online streaming content foes, and it is going to be a tough road.

Some Netflix customers already cancelled their DVD rental plans as a result of the de facto price increase. I think a whole lot more will cancel when Netflix separates the DVD website from the streaming website, and makes it somewhat more inconvenient for customers to make their rental selections.

But, there is a RedBox kiosk seemingly on every corner. Customers can easily log on to the Redbox website or phone app, check movie availability and reserve their copy. It beats visiting a Blockbuster store and hoping they have what you want, when you want it. And getting that movie from Redbox is a whole lot cheaper.  For a vigilant and cost-conscious customer, they can get probably twice as many rentals in a month from a Redbox than they would ever be able to get with a mail service, for about the same amount of money. Plus, they can get them when they want them, which means they are most likely going to watch them right away, instead of getting them in the middle of the week and leaving them lying on the counter for a few days.

If the streaming services continue to struggle for content, especially more recent content, they could easily start to see their subscriber numbers fall off, and customers may start using that more Redbox rentals.

Sure, Redbox doesn’t have new releases on day one, but in the current economy, most people aren’t going to suffer through the inconvenience of Blockbuster stores, not to mention the prices, to get them. And customers certainly aren’t buying the new releases, since the latest sales numbers continue to show a downward trend.

I think that at least in the short-term, Redbox is going to make a killing. And if they are smart, they will continue to install those kiosks at every available location to take advantage of it.

Media Companies are trying to stop the future from coming.

After Netflix announced their new price structure today, the most common question from commenters was if Netflix was going to increase the size and scope of their streaming catalog.

The problem with this question, is that Netflix is not entirely responsible for which titles are available for streaming. The main resistance to allowing those titles to be streamed comes from the content owners themselves who are either clamoring for more licensing fees or trying to ‘encourage’ customers to buy physical media copies by making a physical copy the only availablilty.

What the media companies really want is to continue to make piles of money selling a physical product that is very inexpensive to produce, where they take most, if not all, of the profit. The problem is, with the state of technology in this day and age, consumers want media at their fingertips. They want it available on their computer, smartphone, tablet and through their set top box. They don’t want to own a piece of physical media (most of the time). We are living in the age of the e-reader and the portable music player and smartphones that do all of that and more. We are moving music to the cloud, and still, media companies are clinging to their old business model while it shrivels and dies.

All the while, the media companies are crying about online ‘piracy’, when most of the ‘pirates’ are either people who would have never bought their product anyway, or others who just want to get the media when they want it, in the format they want it in and not be encumbered by draconian copy protection schemes.

If media companies would make their products available when and how the customers want them, at reasonable prices (not $30 for a Blu-ray, thanks), they would more than make up in volume what they lose in profit per unit. Would it negatively affect physical media sales? Perhaps, but those are most likely going to continue to decline regardless, due to the changes that technology is bringing to the culture.

The movie and television industries need to take a look at the music industry and see how much it has struggled due to its failure to change its business model to capitalize on technological advances. The technology shift affected the music industry much earlier than visual media, and should serve as a warning to the movie and television industries to get some vision, or get ready for a very hard road in the years to come.