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Apple iTunes takes just 4% of US digital video market as Netflix dominates

post #1 of 113
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Netflix is the dominant player in America's digital streaming and downloadable video market, representing 61 percent of all viewings, while Apple's iTunes is in a three-way tie for third place with 4 percent.

The NPD Group on Tuesday revealed statistics about the home video market in the U.S., and found that Netflix carries the lion's share of digital content with its Instant Watch streaming rental service. More than six out of ten digital movies watched in the U.S. are streamed via Netflix.

In second place is cable provider Comcast, which represents 8 percent of the American market. The numbers represent market share between January and February of 2011.

Apple is in third place with 4 percent, and is in a three-way tie with DirecTV and Time Warner. Apple began selling movies and TV shows on the iTunes store in 2006, and started offering movie rentals in 2008. TV show rentals for 99 cents, with limited partners, began in 2010.

The survey found that consumers know that services like iTunes have more current releases. But the convenience of Netflix ranked highest in terms of "overall shopping experience" and "value for price paid."

The NPD figures represent both rentals and purchases, but Netflix's dominance comes solely on the back of the subscription service's rentals. The company still offers discs by mail, but has aggressively expanded its Instant Watch program to a number of set top box devices, including Apple's new $99 Apple TV.

Despite Apple's 4 percent share of the digital video market, a separate survey released in February found that Apple is the market leader in terms of video sales, taking 64.5 percent of the market. That study did not count subscription services like Netflix or Hulu.

NPD's VideoWatch Digital tracking service found that digital video now makes up a quarter of all home video-watching volume. But sales of DVDs and Blu-ray discs are still the big money earners for Hollywood. The poll was based on 10,618 completed online surveys of U.S. consumers age 13 and older.

"Overwhelmingly digital movie buyers do not believe physical discs are out of fashion," said Russ Crupnick, entertainment industry analyst for NPD. "But their digital transactions were motivated by the immediate access and ease of acquisition provided by streaming and downloading digital video files."
post #2 of 113
Subscription music = Fail.

Subscription video = Win.

It's just that simple, people...

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post #3 of 113
On May 2 AT&T begins capping residential DSL data to control the "bandwidth hogs." That ought to put the brakes on Netflix and iTunes streaming in short order. Gotta protect that u-verse revenue stream don't you know.
post #4 of 113
Quote:
Originally Posted by lkrupp View Post

On May 2 AT&T begins capping residential DSL data to control the "bandwidth hogs." That ought to put the brakes on Netflix and iTunes streaming in short order. Gotta protect that u-verse revenue stream don't you know.

Residential DSL will be capped at 150GB. That's way more than you'll need in a month for a HEAVY Netflix watcher.

I'm not supporting AT&T's decision in any way, but they're doing this to stop the torrenters who download 100 movies a month. It's very unlikely that it'll affect you or anyone you know. According to AT&T, we're talking less than 2%.
post #5 of 113
And all the money from different sources goes o the same damn people!
post #6 of 113
Yeah, 250GB is a LOT.

Anyways, it's not surprising that Netflix is far in the lead. I pay $9/month, and can watch as many movies on streaming as I want to. Granted, most of the ones I want to see they don't offer on streaming, but still.
post #7 of 113
I wish there was a Netflix style service in the UK, the Apple TV is a great box but suffers from a real lack of content. Apple needs to hurry up and get more services, like the BBC iPlayer, on this thing.
post #8 of 113
Quote:
Originally Posted by simonsharks View Post

I wish there was a Netflix style service in the UK, the Apple TV is a great box but suffers from a real lack of content. Apple needs to hurry up and get more services, like the BBC iPlayer, on this thing.

And I wish we could get the iPlayer here in the States.
post #9 of 113
Maybe a good acquisition for Apple? Just over 10 Billion. ... iFlix?
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post #10 of 113
Quote:
Originally Posted by John.B View Post

Subscription music = Fail.

Subscription video = Win.

It's just that simple, people...

Unless you're willing to cut the cable cord, iTunes TV downloads and Amazon VOD TV downloads just don't make much sense for anything more than the occasional missed episode that you can't find on demand or on a network's web site.
post #11 of 113
Hard to compete with a service that is free. For most users this is just a bonus to their Netflix DVD subscription or streaming only for $9 a month.
post #12 of 113
Quote:
Originally Posted by John.B View Post

Subscription music = Fail.

Subscription video = Win.

It's just that simple, people...

Couldn't agree more. Who the hell wants to line their walls with DVD's? Rent, view, move on. Or, with netflix, view and view again to your hearts content. I always thought it was odd that Apple didn't get this right. Maybe they did but met with too much resistance from the studios. Netflix, as a little insignificant upstart snuck in the back door while everyone was worrying about falling into the clutches of iTunes and its master.
post #13 of 113
Quote:
Originally Posted by John.B View Post

Subscription music = Fail.

Subscription video = Win.

It's just that simple, people...

Ageed. I'll pay $10 a month to watch movies because I watch them once then move on. But music I listen to over and over (and all over... Car, house, garage, gym, etc.) So I gotta own it!

C'mon, Apple! Give us unlimited movies and tv shows for $10 a month! if Netflix can so it, so can you!
post #14 of 113
Quote:
Originally Posted by TimUSCA View Post

Residential DSL will be capped at 150GB. That's way more than you'll need in a month for a HEAVY Netflix watcher.

I'm not supporting AT&T's decision in any way, but they're doing this to stop the torrenters who download 100 movies a month. It's very unlikely that it'll affect you or anyone you know. According to AT&T, we're talking less than 2%.

I'm an AT&T U-verse customer and use it for Internet access. I'm eager to see how AT&T will be reporting or allowing me to monitor my usage. 150GB feels like a big number.

I stream from Netflix, use iTunes for TV series and Digital Copy from Blu-ray combos, use MobileMe to share files and galleries, stream every Yankees game I can, and more. I'm not opposed to a pay by use because I'm reducing my cable subscription with each advancement in on-demand Internet based service; add to that I know that I use the Net more than most but less than many. I wonder what the usage is for those top 2%.

Now then, my area has plenty of competition for cable/satellite & Internet.
post #15 of 113
I like having a choice.

I love the Netflix streaming service through my Apple TV, but I also buy movies from iTunes fairly often-- especially kids movies or movies/tv series we like that aren't on Netflix. It's been years since I purchased a physical disk, and frankly I hope never to dop so again.

I like the combination. Netflix is good for watching older shows that typically get re-run on cable frequently, with the occasional fairly new release. But when there's something new that I missed in theaters, iTunes normally has it. If either Apple offered a streaming service or Netflix offered a rent/buy service for newer videos, it would be a killer service.

I love Apple TV, but I wish I could BUY movies there as well-- buying one movie at a time and letting it copy back to the iTunes library like the old Apple TV is the way to go. It has 8gb flash storage...
post #16 of 113
the appleTV netflix app is just amazing.
post #17 of 113
Quote:
Originally Posted by stevetim View Post

the appleTV netflix app is just amazing.

Yeah, got an ATV2 just a few days ago, and I'm loving it.

I do have to be careful where I point the remote, though, as my iMac is at a ~90-deg. angle from where my ATV2 is. A couple times I was trying to play a movie, and the Beatles started playing.
post #18 of 113
Quote:
Originally Posted by AaronJ View Post

And I wish we could get the iPlayer here in the States.

I read a week or so ago that iPlayer is going global. It said in the US it will be < $10 per month.

http://www.guardian.co.uk/media/2011...al-iplayer-app

I'll be interested to see exactly what will be included (rights issues), but I'd pay $10 for this.
post #19 of 113
Quote:
Originally Posted by AaronJ View Post

And I wish we could get the iPlayer here in the States.

BBC announced iPlayer will be coming soon to non-UK countries, but you will have to pay the equivalent of the UK license fee. Still pretty appealing.

But yeah, AppleTV needs content. MLB is great, but keep'em comin' !
post #20 of 113
Quote:
Originally Posted by MattBookAir View Post

BBC announced iPlayer will be coming soon to non-UK countries, but you will have to pay the equivalent of the UK license fee. Still pretty appealing.

But yeah, AppleTV needs content. MLB is great, but keep'em comin' !

This is what I've been calling for for years! YAY! I'm totally willing to pay the fee.

Thank you.
post #21 of 113
iTunes really doesn't need to dominate this market, but Apple needs to make sure that the providers on available on all of its devices. It makes no sense that I can get Hulu Plus on my iPad and iPhone, as well as my Mac, but not Apple TV, for example.

I love Netflix, but the picture quality isn't great on streaming (worse than iTunes HD in most cases) and the servers seem to be strained recently. Sunday evenings for example is really bad

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post #22 of 113
Quote:
Originally Posted by TimUSCA View Post

Residential DSL will be capped at 150GB. That's way more than you'll need in a month for a HEAVY Netflix watcher.

I'm not supporting AT&T's decision in any way, but they're doing this to stop the torrenters who download 100 movies a month. It's very unlikely that it'll affect you or anyone you know. According to AT&T, we're talking less than 2%.

Yes it will affect you. Right now before you watch a movie, you just think what you want to watch. With the cap, you'll first want to know how many GB would it take. Then nearing end of a month, you'll try to remember if you are close to the limit or not. If you have multiple computers, and multiple users accessing data, you'll have a great time trying to sum up everything before watching a movie.
post #23 of 113
Too bad NetFlix doesn't have any HD movies that are current. I'll take my rentals on iTunes for $4.99 over a $9.00 a month subscription to nothing worth watching.
post #24 of 113
Quote:
Originally Posted by John.B View Post

Subscription music = Fail.

Subscription video = Win.

It's just that simple, people...

For me the equation is:

Subscription music = win = Subscription video

I love my Rhapsody subscription. A vast catalog of music to enjoy for less than the price of a CD (or iTunes album) each month. How can you really beat that? I've got the freedom to explore various artists and genres that I just couldn't get any other way.
post #25 of 113
Quote:
Originally Posted by digitalclips View Post

Maybe a good acquisition for Apple? Just over 10 Billion. ... iFlix?

Once the various ISPs buy up or make exclusive deals with the studios -- and start streaming movies themselves -- Netflix will become redundant.
post #26 of 113
Quote:
Originally Posted by Porchland View Post

Unless you're willing to cut the cable cord, iTunes TV downloads and Amazon VOD TV downloads just don't make much sense for anything more than the occasional missed episode that you can't find on demand or on a network's web site.

I cut the cable cord, entirely using iTunes. (Thankfully, the shows I wanted to watch were on iTunes.)

I added up how much my yearly cable bill would be, vs. how many iTunes Season Passes I could get for the same cost. Answer: a lot more shows than I actually desire to watch first-run!

Meanwhile, Hulu, Netflix, and my local library are all great ways to watch non first-run stuff. And since good, thoughtful shows are the most likely to be cancelled, theres some benefit in waiting!

iTunes fills a niche for me, as does Hulu, but I plan to resume using Netflix as my top video service. The selection cant be beat.
post #27 of 113
I have ATV1 and netflix.com acct.

we watch about 80% netflix,
5% iTMS content,
and 15% 'I plead the fifth on where that content came from, Your Honor'

(note to self... need to move Transmission and all torrent content on a removable, encrypted disk, that is set to 3 tries and self-destruct with a MilSpec 7pass Erase setting).
post #28 of 113
Quote:
Originally Posted by AaronJ View Post

This is what I've been calling for for years! YAY! I'm totally willing to pay the fee.

Thank you.

Is there that much good stuff on the BEEB these days to be worth the fee? I ask as I haven't been able to watch it in 20 years since moving to the States.

BTW (and un related to my first question) On my few visits I did notice I could no longer understand many of the newscasters due to strong regional accents, a far cry from BBC English I remember! What happened?

http://www.guardian.co.uk/media/2011...al-iplayer-app
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post #29 of 113
I'm most likely a little off the average, as I don't have cable or satellite. If I used iTunes in place of HuluPlus and NetFlix I would probably be paying $100 or more a month. Sorry, that's just way too much. And RedBox et al have set the price for movie rental at 25% of the iTunes movie price, so iTunes loses there as well.

Just to watch The Daily Show from iTunes would cost $40 a month, plus it's usually delivered much later than Hulu.

iTunes gets the 4% of users who are not price sensitive. It's too bad for me, because I'd much rather have Apple TV than Roku, but I guess I'm just too cheap.
post #30 of 113
Quote:
Originally Posted by TimUSCA View Post

Residential DSL will be capped at 150GB. That's way more than you'll need in a month for a HEAVY Netflix watcher.

I'm not supporting AT&T's decision in any way, but they're doing this to stop the torrenters who download 100 movies a month. It's very unlikely that it'll affect you or anyone you know. According to AT&T, we're talking less than 2%.

Quote:
Originally Posted by AaronJ View Post

Yeah, 250GB is a LOT.

Anyways, it's not surprising that Netflix is far in the lead. I pay $9/month, and can watch as many movies on streaming as I want to. Granted, most of the ones I want to see they don't offer on streaming, but still.


250GB is merely adequate and should be the bare minimum. I can regularly hit that number, and in months during which I'm at home a lot (December and January) I can easily hit 350-450GB.

If ISPs are going to give us modems and plans that have the theoretical capability of downloading upwards of 1300GB a month, then they should expect customers to want to get full value for their money. There is no such thing as a "bandwidth hog." Arbitrary limits are simply that, arbitrary. There is no basis in logic for choosing that number.
post #31 of 113
Quote:
Originally Posted by samwell View Post

Once the various ISPs buy up or make exclusive deals with the studios -- and start streaming movies themselves -- Netflix will become redundant.

Yes, probably true. Bag of hurt
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post #32 of 113
Quote:
Originally Posted by PaulMJohnson View Post

I read a week or so ago that iPlayer is going global. It said in the US it will be < $10 per month.

http://www.guardian.co.uk/media/2011...al-iplayer-app

I'll be interested to see exactly what will be included (rights issues), but I'd pay $10 for this.

Doctor Who will air in the US the same day as the UL for the first time ever this season. They also filmed in the US for the first time. Torchwood is also picking up some US actors for the cast and being backed by Starz network where it will presumably air, perhaps on the same days in both countries.
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post #33 of 113
[QUOTE=AaronJ;1829325 I do have to be careful where I point the remote, though, as my iMac is at a ~90-deg. angle from where my ATV2 is. A couple times I was trying to play a movie, and the Beatles started playing. [/QUOTE]

If you take a moment to pair your remote to the Apple TV, that annoying problem disappears ... Just look under settings and then remotes ... Your remote will then only work on that Apple TV, no mater what other iDevices are around.
post #34 of 113
Quote:
Originally Posted by digitalclips View Post

Is there that much good stuff on the BEEB these days to be worth the fee? I ask as I haven't been able to watch it in 20 years since moving to the States.

If Doctor Who were the only thing, it would be worth it.
post #35 of 113
Quote:
Originally Posted by battiato1981 View Post

If you take a moment to pair your remote to the Apple TV, that annoying problem disappears ... Just look under settings and then remotes ... Your remote will then only work on that Apple TV, no mater what other iDevices are around.

Oh, yeesh. I should have done that myself.

Thanks for the heads-up.
post #36 of 113
Quote:
Originally Posted by TimUSCA View Post

Residential DSL will be capped at 150GB. That's way more than you'll need in a month for a HEAVY Netflix watcher.

Quote:
Originally Posted by AaronJ View Post

Yeah, 250GB is a LOT...

Quote:
Originally Posted by dualie View Post

250GB is merely adequate and should be the bare minimum. I can regularly hit that number, and in months during which I'm at home a lot (December and January) I can easily hit 350-450GB.

I agree with dualie. I don't what you guys think a lot is, but my wife and I pretty much exclusively watch netflix (we work different schedules so maybe 4 hours a day). Combined with regular internet usage, we use 230-250GB a month.
post #37 of 113
Quote:
Originally Posted by digitalclips View Post

Is there that much good stuff on the BEEB these days to be worth the fee? I ask as I haven't been able to watch it in 20 years since moving to the States.

BTW (and un related to my first question) On my few visits I did notice I could no longer understand many of the newscasters due to strong regional accents, a far cry from BBC English I remember! What happened?

http://www.guardian.co.uk/media/2011...al-iplayer-app

For me it depends on what actually ends up being available. I would assume rights issues will prevent the full iPlayer being available in the US. For example, Ricky Gervais' productions are co-produced by the BBC and HBO, and I assume HBO will hold the exclusive rights to show that stuff in the US - I'm sure there will be a few things like that.

However, I'd be happy to pay $10 per month for Have I Got News For You and Question Time alone.

I know what you mean about the regional accents on BBC News. It's the outcome of 13 years of a Labour government in my opinion. They put pressure on the BBC to cover things other than London more (which in itself is a sensible goal), but the BBC interpreted that to mean they had to have regional accents, which if they are hard to understand, does not make sense.
post #38 of 113
the reasons for NetFlix success are simple - a great low price for the service and no time limits on watching anything. snailmail BD's and a huge DVD catalog (which can be ripped) add options for those looking for more. it's a great deal for consumers, hence its 60%+ market share.

all the more more expensive a la carte services like iTunes can offer for the home viewer is earlier access to the big hits. but only the impatient really need that. and you can just do it the few times you feel the urge. their biggest audience is probably mobil device users who are traveling and want to kill some time with a recent movie. there is no sales volume in that model. hence Apple's 4% share.

the problem is, the mediacos hate NetFlix. maybe even more than iTunes now. they see their product being sold too cheap and kicking back too little cash to them. and the telcos hate it too, because it uses them as "dumb pipes."

the new AT&T 150G monthly data cap is the first effort by these guys to get a bigger piece of NetFlix action. more telco limits will follow. and all the mediacos will demand sharply higher license fees when those contracts come up for renewal.

so the direct and indirect cost of NetFlix will be going up. a lot.
post #39 of 113
Quote:
Originally Posted by un_plug View Post

I agree with dualie. I don't what you guys think a lot is, but my wife and I pretty much exclusively watch netflix (we work different schedules so maybe 4 hours a day). Combined with regular internet usage, we use 230-250GB a month.

As someone who almost certainly uses less than 50Gb per month (I'm a light Netflix user, and download a few albums a month) I could be inclined to say it's fair enough you pay more than I do.

However, charging by use is only fair if they charge a fair rate. The incremental cost per Gb for a network provider is close to nothing (in the rage of cents, not dollars), so if they were to charge, for example, $5 per extra 100Gb, that would be fair. $50 per 100Gb would not.

Speaking of network providers, you might all be interested in this blog done by Netflix, which compares ISPs in terms of throughput. If you have a choice between two or three, it might be a useful tool.

http://techblog.netflix.com/2011/01/...-networks.html
post #40 of 113
Quote:
Originally Posted by nagromme View Post

I cut the cable cord, entirely using iTunes. (Thankfully, the shows I wanted to watch were on iTunes.)

I added up how much my yearly cable bill would be, vs. how many iTunes Season Passes I could get for the same cost. Answer: a lot more shows than I actually desire to watch first-run!

I did exactly the same thing which led me to purchased the 1st-gen AppleTV. $100/month for Comcast = $1200/yr. With season passes anywhere from $20-50 that's between 24-60 series I could purchase. Since I watch about six shows religiously, I save about $1000/yr (plus no commercials and I can rewatch shows if I want).

Quote:
Originally Posted by AaronJ View Post

I do have to be careful where I point the remote, though, as my iMac is at a ~90-deg. angle from where my ATV2 is. A couple times I was trying to play a movie, and the Beatles started playing.

You know you can pair your remotes, right? By default every device will see every Apple Remote, but you can pair them so that you won't accidentally trip the wrong machine .
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