Actually, no because the rate at which you can watch movies via DVD is gated by how fast discs move back and forth. For streaming...well one time I was sick I watched all the episodes of Dollhouse in a couple days. Plus, even though you're not supposed to, sometimes the kids and I watch different movies at the same time.
Netflix is pretty much a bad deal all around for studios...but I have no pity for them. If VOD/PPV and digital rental was $0.99 just like DVD rentals the economic model would be much better for them than the Netflix model. $5 for HD rental from iTunes? Forget it. I'll wait for it to show up on Netflix or buy the BluRay off Amazon. The $4 for SD rental on iTunes is even worse. Heck, the $20 they charge for HD purchase can often get me the same movie on BR with DVD and Digital Copy.
I've only ever purchased only 3-4 movies from iTunes and never rented.
You're ignoring the cost of disc replacement for lost and damaged disc and mailer packaging and mailing. According to netflix, the hold up of release for streaming is from the content creators. All they have to do is delay release of new titles to netflix until a decent amount of time after release for disc purchase so streaming services don't eat into initial disc sales; then cut a deal with netflix to adjust the cost of streaming subscription to offset the difference to title owners from streaming's lack of built in "speed bump" vs disc turn around in mailing. I don't think many streaming customers would object to a modest increase in subscription service it gave them parity of title availability with the disc service. The result would probably be an increase in streaming subscriptions over all. $5 dollars is cheaper than going to the movies. Sorry, but I don't see how it makes since to purchase a movie on blue ray at a much greater price if you're already complaining about a $5 dollar rental. How many times do you really wanna watch the same movie?
You're ignoring the cost of disc replacement for lost and damaged disc and mailer packaging and mailing. According to netflix, the hold up of release for streaming is from the content creators. All they have to do is delay release of new titles to netflix until a decent amount of time after release for disc purchase so streaming services don't eat into initial disc sales; then cut a deal with netflix to adjust the cost of streaming subscription to take into offset the difference to title owners from streaming's lack of built in "speed bump" vs disc turn around in mailing. I don't think many streaming customers would object to a modest increase in subscription service it gave them parity of title availability with the disc service. The result would probably be an increase in streaming subscriptions over all.
The hold up is because the $7.99/month all you can view price massively devalues the perceived worth of the available content vs $100/month cable, $0.99 DVD rental, etc. If I were a content producer I would be dragging my heels too. Increased subs for Netflix does zero for my bottom line.
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$5 dollars is cheaper than going to the movies. Sorry, but I don't see how it makes since to purchase a movie on blue ray at a much greater price if you're already complaining about a $5 dollar rental. How many times do you really wanna watch the same movie?
Because it's not about cost but perceived value. I can either buy Iron Man 2 from iTunes for $19.99 or from Amazon as a blu-ray for $14.96 that has a DVD and digital copy.
And I'd much rather spend $15 and own it than spend $5 and not have anything.
Or watch it for "free" as part of Netflix when it shows up for $7.99 a month. $5 is too large a fraction of the netflix monthly subscription for me to perceive it as a good value. But $0.99 per rental I view as a fair price even if it means I end up paying more than $7.99 per month for the content I watch.
The hold up is because the $7.99/month all you can view price massively devalues the perceived worth of the available content vs $100/month cable, $0.99 DVD rental, etc. If I were a content producer I would be dragging my heels too. Increased subs for Netflix does zero for my bottom line.
Because it's not about cost but perceived value. I can either buy Iron Man 2 from iTunes for $19.99 or from Amazon as a blu-ray for $14.96 that has a DVD and digital copy.
And I'd much rather spend $15 and own it than spend $5 and not have anything.
Or watch it for "free" as part of Netflix when it shows up for $7.99 a month. $5 is too large a fraction of the netflix monthly subscription for me to perceive it as a good value. But $0.99 per rental I view as a fair price even if it means I end up paying more than $7.99 per month for the content I watch.
You're undercutting your own argument. Folks inclined to purchase movies because they personally find more value in owning a movie (like yourself), aren't going to be dissuaded from buying it just because it's available for rental on a download service in whatever model. If content creators feel otherwise, all they have to do is work with netflix to adjust the current streaming model—limit the number of downloads of a given title per subscription year, or limit the time frame it's available after you choose it, and after that window it won't be available to you again until another particular stretch of time passes. Most customers interested in renting, vs. buying, aren't going to give a crap if they can't watch a particular title a hundred times, they only want to watch it once.
As per cable TV, your stated cost isn't quite accurate. You can't compare the cost of your entire TV cable bill to any particular streaming model. If you want uncut, commercial free movies you by a premium channel. In my service area that's $15 bucks a month. In essence, it's a limited movie/specials rental service where the available titles are relatively few, but they rotate titles every month. In reality the streaming model I described above is comparable in price to a premium channel subscription (like HBO or Showtime).
My argument is very simple: $5 rental of HD video is very expensive in comparison to a $8/month Netflix sub OR a $1.50 Blu-Ray rental from Redbox OR a $15 Blu-Ray purchase.
It feels like a bad value proposition in comparison to any of those three options. It's not about absolute cost since one of those options is more money. Again, it's about perceived value in comparison to alternatives.
Sure, people still rent form iTunes but as these numbers show, Netflix SVOD is perceived as a much better value by the majority of digital viewers. The pricing of iTunes EST (electronic sell through) and VOD sucks in comparison to Amazon (for BR purchase) and Netflix (for SVOD).
My argument is very simple: $5 rental of HD video is very expensive in comparison to a $8/month Netflix sub OR a $1.50 Blu-Ray rental from Redbox OR a $15 Blu-Ray purchase.
It feels like a bad value proposition in comparison to any of those three options. It's not about absolute cost since one of those options is more money. Again, it's about perceived value in comparison to alternatives.
Sure, people still rent form iTunes but as these numbers show, Netflix SVOD is perceived as a much better value by the majority of digital viewers. The pricing of iTunes EST (electronic sell through) and VOD sucks in comparison to Amazon (for BR purchase) and Netflix (for SVOD).
Your argument is simplistic.
5 dollars to rent a movie is not more expensive than $15 to purchase a Blu-Ray. Renting is entirely different than owning, comparing them as if they're the same is useless. I almost never buy movies. I own maybe 10 movies I feel worth owning. Unless you think every movie available for rent at $5 is a movie you'd rather own, than a $5 dollar rental is a helluva lot cheaper than a $15 dollar purchase for a Blu-Ray you don't want, especially if it turns out the movie you've never seen before happens to be a turd of a movie.
You have to take yourself to a Redbox to get a movie, then take the movie back. So you can look at that 5 dollar single stream movie rental as equivalent to the $1.50 Redbox, but you purchase your way out of a trip to a kiosk for an additional $1.75 per trip. Since the whole purpose of digital streaming is convenience, that's a reasonable price to many.
Someone was arguing on behalf of title owners in favor of netflix continuing to limit their streaming library. That $8 dollar subscription is not cheaper than a single $5 dollar streaming rental, if the movie you want to rent isn't available on netflix when you want to watch it, or maybe never. For that particular movie, paying for netflix is paying to NOT watch the movie you want. That puts you back to renting for $5 bucks, vs. purchasing a Blu-Ray disc. I happen to have streaming netflix, and I also rent movies on iTunes. So that single $5 streaming rental is only "very expensive" if you ignore all the other criteria for how people chose their entertainment value and the opportunity costs associated with it.
5 dollars to rent a movie is not more expensive than $15 to purchase a Blu-Ray. Renting is entirely different than owning, comparing them as if they're the same is useless. I almost never buy movies. I own maybe 10 movies I feel worth owning. Unless you think every movie available for rent at $5 is a movie you'd rather own, than a $5 dollar rental is a helluva lot cheaper than a $15 dollar purchase for a Blu-Ray you don't want, especially if it turns out the movie you've never seen before happens to be a turd of a movie.
You have to take yourself to a Redbox to get a movie, then take the movie back. So you can look at that 5 dollar single stream movie rental as equivalent to the $1.50 Redbox, but you purchase your way out of a trip to a kiosk for an additional $1.75 per trip. Since the whole purpose of digital streaming is convenience, that's a reasonable price to many.
Someone was arguing on behalf of title owners in favor of netflix continuing to limit their streaming library. That $8 dollar subscription is not cheaper than a single $5 dollar streaming rental, if the movie you want to rent isn't available on netflix when you want to watch it, or maybe never. For that particular movie, paying for netflix is paying to NOT watch the movie you want. That puts you back to renting for $5 bucks, vs. purchasing a Blu-Ray disc. I happen to have streaming netflix, and I also rent movies on iTunes. So that single $5 streaming rental is only "very expensive" if you ignore all the other criteria for how people chose their entertainment value and the opportunity costs associated with it.
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
How many people have an AppleTV? Percentage of marketshare does not preclude profitability or the value of the service to the niche market customer the smaller market share holder offers.
I can offer myself as an example to answer your question.
I have NetFlix streaming. I also have Amazon prime streaming (because it came with Amazon prime which I subscribe to for the free shipping and purchase points.) I have premium cable channels as well (HBO/Showtime). I have Hulu on my PS3 (and NetFlix and Amazon prime on that as well). NetFlix and Amazon are virtually duplicates as far as title library. Obviously, I watch a butt load of TV. I have an AppleTv mainly because it allows me to stream my iTunes music library to 4 different AVRs. I watch NetFlix on my Apple TV because I prefer that interface to the PS3 implementation of NetFlix. If I happen to have the time to watch a movie, and I've seen everything currently on premium cable channels and there's nothing on netflix I wanna see at a particular time, I rent a movie from iTunes because they have a large assortment of new releases and any number of old stuff not on NetFlix or the other providers I mentioned. I don't watch any particular thing simply because it's on NeFlix, or iTunes, or cable. I watch what I want, when I want, from what ever source it's available for the lowest cost at that particular time I want to watch that particular thing. You are evaluating the price of an iTunes rental in isolation as if everyone's choice for a particular movie/TV show at a particular time they want to view it, is a choice betweens iTunes and nothing else, or netflix and nothing else, etc. That's not the way media is consumed. Again, "very expensive" is relative to the availability of the particular title you want to watch, when it's available, and how available it is on other sources. One more time, pricing models are not as simplistic as you insist they are.
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
They aren't even targeting the same use. The only thing they have in common is they stream movies. How many of the top 100 movies on the iTunes store are even available on Netflix streaming. I would be shocked if the number is more than 5. Apple doesn't consider netflix streaming a competitor, they even bundle it on the AppleTV.
The question for Apple isn't does Netflix generate more revenue than iTunes movies, it's simply the question of if iTunes movie revenue is growing or declining. The recent artificial change to market share numbers is totally irrelevant.
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
Agreed, simple argument or not, it is all about perceived value. The "suck it up bitch, you are paying for the convenience" argument seems like the simplistic one. 100 million downloads for movies isn't really that impressive; Netflix streams that in a month. They ship more dvds than that by mail (1 billion by 2007). If I feel like I am being ripped off for no good reason, I am not going to pay. Now I'll get my movies from kiosks, libraries etc but others when they feel they are being ripped off feel far less sympathetic when they pirate your movies (the old you rip me off, I rip you off argument) With iTunes movie and TV rentals, I feel like I am being ripped off. Streaming should be cheaper for all kinds of reasons, but I am being charged 100% more than I think I should be paying... 100% more than I would pay at a dvd rental store or a kiosk. What I think I should be paying is all that really matters to me... the consumer.
They aren't even targeting the same use. The only thing they have in common is they stream movies.
They are targeting home and mobile entertainment. They compete for revenue and usage. In both areas iTunes now trails Netflix.
Apple currently includes Netflix it's because the studios won't let them offer SVOD out of fear.
Apple tends to commoditize content to a certain level to make their hardware ecosystem attractive. While they insure that the content producers are profitable they certainly make sure that the content is commoditized. Something that media content providers don't want to happen.
Take games. Traditional hand held games are $20 to $40. iPad/iPhone games are $0.99/$19.99 with probably an average of $4.99. Same for music. $0.99 individual songs are profitable but not like the old album sales. These content producers make money and it is in Apple interest that they do so and are healthy but the lions share of the immediate revenue ends up in Apple's hands in the form of hardware sales.
They haven't been able to do that to TV or movies. So Apple uses Netflix for this for now. Eventually content producers will cave and we'll see much better pricing for iTunes VOD.
How many people have an AppleTV? Percentage of marketshare does not preclude profitability or the value of the service to the niche market customer the smaller market share holder offers.
AppleTV volumes are so-so. aTV margins are so-so. aTV ASPs are meager (only $99). iTunes video profitability is so-so. It's profitable, yes. But as Cook pointed out, very very different from other Apple offerings. A product in any other category that was this so-so would have been axed.
iTunes doesn't just exist on aTV but also iPod, iPhone, iPad and Mac. So your implication here that iTunes VOD lacks potential customers because it is limited to the aTV is untrue. It is niche but not because there isn't a critical mass of potential users. It is the offering itself that is weak IMHO.
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I can offer myself as an example to answer your question.
It does? What do you think the question is?
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You are evaluating the price of an iTunes rental in isolation as if everyone's choice for a particular movie/TV show at a particular time they want to view it, is a choice betweens iTunes and nothing else, or netflix and nothing else, etc. That's not the way media is consumed. Again, "very expensive" is relative to the availability of the particular title you want to watch, when it's available, and how available it is on other sources. One more time, pricing models are not as simplistic as you insist they are.
The way most folks I know seem to pick what to watch is to watch whatever happens to be on cable vs renting something specific. That strikes me as the way media is consumed and not some laser like zeroing in on a particular movie.
One more time...pricing models are whatever they are but consumers decide what represents a good value and vote with their dollars. Those dollars appear to be going for the streaming whatever they can get when they flip on the TV vs your "I wanna watch X and therefore I'll only watch X even if I have to pay $5 on iTunes".
Even in your example iTunes is the last step: "If I happen to have the time to watch a movie, and I've seen everything currently on premium cable channels and there's nothing on netflix I wanna see at a particular time"...
Given the data provided it appears that most folks don't get that far. Probably because they know in a month it'll appear on cable or netflix for "free".
Using FiOS 25 / 25 we use Netflix via an Apple TV and Apple Airport Extreme to watch HD TV on a large screen every night flawlessly. To all those that moan about problems I can assure them it isn't Netflix, rather it's their ISP, their hardware or connection speed.
They probably have AT&T u-verse. I also have an AE router & AppleTV, quality is fantastic for Netflix streaming.
Netflix is also paying Amazon, which charges 5 times the amount for bandwidth than it would cost them if they just had their equipment at cheap edge nodes. If they borrowed a page from Youtube/Google's playbook all they have to do is put their own equipment inside ISP's data centers, and the bandwidth cost to deliver to end users is magically zero.
I don't know Netflix/Amazon's actual numbers, but the cheapest bandwidth you can get requires building your own datacenters, which is something netflix should be doing, and not simply using Amazon since Amazon is competing with them for exactly the same thing.
I saw this mentioned on some other site and I remembered your comment. It sounds like they've been working on it for a bit:
AppleTV volumes are so-so. aTV margins are so-so. aTV ASPs are meager (only $99). iTunes video profitability is so-so. It's profitable, yes. But as Cook pointed out, very very different from other Apple offerings. A product in any other category that was this so-so would have been axed.
I wouldn't be surprised if the AppleTV margins were in line with other Apple products, especially when you get the economies of scale going. Raspberry Pi is a single board ARM computer with HDMI out, network port, a USB jack and costs $35 a piece. I think it's possible to add a shell, throw in a remote, power supply, cable and still be as profitable as any other Apple product, especially given the million+ unit runs.
Using FiOS 25 / 25 we use Netflix via an Apple TV and Apple Airport Extreme to watch HD TV on a large screen every night flawlessly. To all those that moan about problems I can assure them it isn't Netflix, rather it's their ISP, their hardware or connection speed.
AppleTV seems to demand more bandwidth for the same service, and I can't find any setting to fix that. My Netflix streaming works considerably better on a PS3. My AppleTV often halts to buffer several times for a 20 minute episode, the PS3 sometimes, but at most once. So yes, if you give it ideal internet service, but not everyone is working with the ideal. Other products seem to work better with non-ideal situations. I would say PS3 is more robust for this use.
I prefer to stream movies and TV shows instead of buying them. I own about five DVDs. They were bought when I wasn't willing to wait for a video stream version. I don't think I've watched more than one of them twice. There are less than ten movies I would want to own on DVD and I still haven't gotten around to buying them. That is how little I really want to own DVDs. I love movies and some TV shows. I watch every day and night.
Movies can be like music to some people. They are just as much fun to watch numerous times as they are to see the first time. I'm not that way with movies. Netflix is my favorite source for video content. This is my second favorite streaming source for quality: http://xfinitytv.comcast.net/?cmpid=rdrct_td ; My third choice is an aggregate site: http://www.free-tv-video-online.me/internet/. After that I just go to TV networks to watch shows that aren't available on the others.
I guess I'm a little confused here. How can Netflix compete with Apple in the Movie business when Apple supports Netflix on the Apple TV. So, the more Apple TVs they sell the more access Netflix has to their customers. Do you think if they saw them as competitors that the Netflix app would be on their device. I'm going with NO!
have anyone tried to stream and download movies from http://www.onchannel.net movie sharing website? this site has alots of new movies psted each day with free external streaming links. it alos has tv shows in full lenght added everyday.
I prefer to stream movies and TV shows instead of buying them. I own about five DVDs. They were bought when I wasn't willing to wait for a video stream version. I don't think I've watched more than one of them twice. There are less than ten movies I would want to own on DVD and I still haven't gotten around to buying them. That is how little I really want to own DVDs. I love movies and some TV shows. I watch every day and night.
Movies can be like music to some people. They are just as much fun to watch numerous times as they are to see the first time. I'm not that way with movies. Netflix is my favorite source for video content. This is my second favorite streaming source for quality: http://xfinitytv.comcast.net/?cmpid=rdrct_td ; My third choice is an aggregate site: http://www.free-tv-video-online.me/internet/. After that I just go to TV networks to watch shows that aren't available on the others.
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Originally Posted by nht
Actually, no because the rate at which you can watch movies via DVD is gated by how fast discs move back and forth. For streaming...well one time I was sick I watched all the episodes of Dollhouse in a couple days. Plus, even though you're not supposed to, sometimes the kids and I watch different movies at the same time.
Netflix is pretty much a bad deal all around for studios...but I have no pity for them. If VOD/PPV and digital rental was $0.99 just like DVD rentals the economic model would be much better for them than the Netflix model. $5 for HD rental from iTunes? Forget it. I'll wait for it to show up on Netflix or buy the BluRay off Amazon. The $4 for SD rental on iTunes is even worse. Heck, the $20 they charge for HD purchase can often get me the same movie on BR with DVD and Digital Copy.
I've only ever purchased only 3-4 movies from iTunes and never rented.
You're ignoring the cost of disc replacement for lost and damaged disc and mailer packaging and mailing. According to netflix, the hold up of release for streaming is from the content creators. All they have to do is delay release of new titles to netflix until a decent amount of time after release for disc purchase so streaming services don't eat into initial disc sales; then cut a deal with netflix to adjust the cost of streaming subscription to offset the difference to title owners from streaming's lack of built in "speed bump" vs disc turn around in mailing. I don't think many streaming customers would object to a modest increase in subscription service it gave them parity of title availability with the disc service. The result would probably be an increase in streaming subscriptions over all. $5 dollars is cheaper than going to the movies. Sorry, but I don't see how it makes since to purchase a movie on blue ray at a much greater price if you're already complaining about a $5 dollar rental. How many times do you really wanna watch the same movie?
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Originally Posted by GMHut
You're ignoring the cost of disc replacement for lost and damaged disc and mailer packaging and mailing. According to netflix, the hold up of release for streaming is from the content creators. All they have to do is delay release of new titles to netflix until a decent amount of time after release for disc purchase so streaming services don't eat into initial disc sales; then cut a deal with netflix to adjust the cost of streaming subscription to take into offset the difference to title owners from streaming's lack of built in "speed bump" vs disc turn around in mailing. I don't think many streaming customers would object to a modest increase in subscription service it gave them parity of title availability with the disc service. The result would probably be an increase in streaming subscriptions over all.
The hold up is because the $7.99/month all you can view price massively devalues the perceived worth of the available content vs $100/month cable, $0.99 DVD rental, etc. If I were a content producer I would be dragging my heels too. Increased subs for Netflix does zero for my bottom line.
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$5 dollars is cheaper than going to the movies. Sorry, but I don't see how it makes since to purchase a movie on blue ray at a much greater price if you're already complaining about a $5 dollar rental. How many times do you really wanna watch the same movie?
Because it's not about cost but perceived value. I can either buy Iron Man 2 from iTunes for $19.99 or from Amazon as a blu-ray for $14.96 that has a DVD and digital copy.
And I'd much rather spend $15 and own it than spend $5 and not have anything.
Or watch it for "free" as part of Netflix when it shows up for $7.99 a month. $5 is too large a fraction of the netflix monthly subscription for me to perceive it as a good value. But $0.99 per rental I view as a fair price even if it means I end up paying more than $7.99 per month for the content I watch.
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Originally Posted by nht
The hold up is because the $7.99/month all you can view price massively devalues the perceived worth of the available content vs $100/month cable, $0.99 DVD rental, etc. If I were a content producer I would be dragging my heels too. Increased subs for Netflix does zero for my bottom line.
Because it's not about cost but perceived value. I can either buy Iron Man 2 from iTunes for $19.99 or from Amazon as a blu-ray for $14.96 that has a DVD and digital copy.
And I'd much rather spend $15 and own it than spend $5 and not have anything.
Or watch it for "free" as part of Netflix when it shows up for $7.99 a month. $5 is too large a fraction of the netflix monthly subscription for me to perceive it as a good value. But $0.99 per rental I view as a fair price even if it means I end up paying more than $7.99 per month for the content I watch.
You're undercutting your own argument. Folks inclined to purchase movies because they personally find more value in owning a movie (like yourself), aren't going to be dissuaded from buying it just because it's available for rental on a download service in whatever model. If content creators feel otherwise, all they have to do is work with netflix to adjust the current streaming model—limit the number of downloads of a given title per subscription year, or limit the time frame it's available after you choose it, and after that window it won't be available to you again until another particular stretch of time passes. Most customers interested in renting, vs. buying, aren't going to give a crap if they can't watch a particular title a hundred times, they only want to watch it once.
As per cable TV, your stated cost isn't quite accurate. You can't compare the cost of your entire TV cable bill to any particular streaming model. If you want uncut, commercial free movies you by a premium channel. In my service area that's $15 bucks a month. In essence, it's a limited movie/specials rental service where the available titles are relatively few, but they rotate titles every month. In reality the streaming model I described above is comparable in price to a premium channel subscription (like HBO or Showtime).
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Originally Posted by GMHut
You're undercutting your own argument.
My argument is very simple: $5 rental of HD video is very expensive in comparison to a $8/month Netflix sub OR a $1.50 Blu-Ray rental from Redbox OR a $15 Blu-Ray purchase.
It feels like a bad value proposition in comparison to any of those three options. It's not about absolute cost since one of those options is more money. Again, it's about perceived value in comparison to alternatives.
Sure, people still rent form iTunes but as these numbers show, Netflix SVOD is perceived as a much better value by the majority of digital viewers. The pricing of iTunes EST (electronic sell through) and VOD sucks in comparison to Amazon (for BR purchase) and Netflix (for SVOD).
Quote:
Originally Posted by nht
My argument is very simple: $5 rental of HD video is very expensive in comparison to a $8/month Netflix sub OR a $1.50 Blu-Ray rental from Redbox OR a $15 Blu-Ray purchase.
It feels like a bad value proposition in comparison to any of those three options. It's not about absolute cost since one of those options is more money. Again, it's about perceived value in comparison to alternatives.
Sure, people still rent form iTunes but as these numbers show, Netflix SVOD is perceived as a much better value by the majority of digital viewers. The pricing of iTunes EST (electronic sell through) and VOD sucks in comparison to Amazon (for BR purchase) and Netflix (for SVOD).
Your argument is simplistic.
5 dollars to rent a movie is not more expensive than $15 to purchase a Blu-Ray. Renting is entirely different than owning, comparing them as if they're the same is useless. I almost never buy movies. I own maybe 10 movies I feel worth owning. Unless you think every movie available for rent at $5 is a movie you'd rather own, than a $5 dollar rental is a helluva lot cheaper than a $15 dollar purchase for a Blu-Ray you don't want, especially if it turns out the movie you've never seen before happens to be a turd of a movie.
You have to take yourself to a Redbox to get a movie, then take the movie back. So you can look at that 5 dollar single stream movie rental as equivalent to the $1.50 Redbox, but you purchase your way out of a trip to a kiosk for an additional $1.75 per trip. Since the whole purpose of digital streaming is convenience, that's a reasonable price to many.
Someone was arguing on behalf of title owners in favor of netflix continuing to limit their streaming library. That $8 dollar subscription is not cheaper than a single $5 dollar streaming rental, if the movie you want to rent isn't available on netflix when you want to watch it, or maybe never. For that particular movie, paying for netflix is paying to NOT watch the movie you want. That puts you back to renting for $5 bucks, vs. purchasing a Blu-Ray disc. I happen to have streaming netflix, and I also rent movies on iTunes. So that single $5 streaming rental is only "very expensive" if you ignore all the other criteria for how people chose their entertainment value and the opportunity costs associated with it.
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Originally Posted by GMHut
Your argument is simplistic.
5 dollars to rent a movie is not more expensive than $15 to purchase a Blu-Ray. Renting is entirely different than owning, comparing them as if they're the same is useless. I almost never buy movies. I own maybe 10 movies I feel worth owning. Unless you think every movie available for rent at $5 is a movie you'd rather own, than a $5 dollar rental is a helluva lot cheaper than a $15 dollar purchase for a Blu-Ray you don't want, especially if it turns out the movie you've never seen before happens to be a turd of a movie.
You have to take yourself to a Redbox to get a movie, then take the movie back. So you can look at that 5 dollar single stream movie rental as equivalent to the $1.50 Redbox, but you purchase your way out of a trip to a kiosk for an additional $1.75 per trip. Since the whole purpose of digital streaming is convenience, that's a reasonable price to many.
Someone was arguing on behalf of title owners in favor of netflix continuing to limit their streaming library. That $8 dollar subscription is not cheaper than a single $5 dollar streaming rental, if the movie you want to rent isn't available on netflix when you want to watch it, or maybe never. For that particular movie, paying for netflix is paying to NOT watch the movie you want. That puts you back to renting for $5 bucks, vs. purchasing a Blu-Ray disc. I happen to have streaming netflix, and I also rent movies on iTunes. So that single $5 streaming rental is only "very expensive" if you ignore all the other criteria for how people chose their entertainment value and the opportunity costs associated with it.
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
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Originally Posted by nht
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
How many people have an AppleTV? Percentage of marketshare does not preclude profitability or the value of the service to the niche market customer the smaller market share holder offers.
I can offer myself as an example to answer your question.
I have NetFlix streaming. I also have Amazon prime streaming (because it came with Amazon prime which I subscribe to for the free shipping and purchase points.) I have premium cable channels as well (HBO/Showtime). I have Hulu on my PS3 (and NetFlix and Amazon prime on that as well). NetFlix and Amazon are virtually duplicates as far as title library. Obviously, I watch a butt load of TV. I have an AppleTv mainly because it allows me to stream my iTunes music library to 4 different AVRs. I watch NetFlix on my Apple TV because I prefer that interface to the PS3 implementation of NetFlix. If I happen to have the time to watch a movie, and I've seen everything currently on premium cable channels and there's nothing on netflix I wanna see at a particular time, I rent a movie from iTunes because they have a large assortment of new releases and any number of old stuff not on NetFlix or the other providers I mentioned. I don't watch any particular thing simply because it's on NeFlix, or iTunes, or cable. I watch what I want, when I want, from what ever source it's available for the lowest cost at that particular time I want to watch that particular thing. You are evaluating the price of an iTunes rental in isolation as if everyone's choice for a particular movie/TV show at a particular time they want to view it, is a choice betweens iTunes and nothing else, or netflix and nothing else, etc. That's not the way media is consumed. Again, "very expensive" is relative to the availability of the particular title you want to watch, when it's available, and how available it is on other sources. One more time, pricing models are not as simplistic as you insist they are.
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Originally Posted by nht
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
They aren't even targeting the same use. The only thing they have in common is they stream movies. How many of the top 100 movies on the iTunes store are even available on Netflix streaming. I would be shocked if the number is more than 5. Apple doesn't consider netflix streaming a competitor, they even bundle it on the AppleTV.
The question for Apple isn't does Netflix generate more revenue than iTunes movies, it's simply the question of if iTunes movie revenue is growing or declining. The recent artificial change to market share numbers is totally irrelevant.
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Originally Posted by nht
If my argument is simplistic pray tell why ITunes VOD model is less successful today (4%) than Netflix SVOD model (61%)? If most folks believe that $5/HD rental or $4/SD rental is a good value proposition then I would assume that we wouldn't see such a large divergence in market share.
You also cannot tell me that I cannot compare X to Y when I make that value comparison all the time and it appears that many consumers also make that value comparison all the time and have chosen Netflix SVOD over iTunes VOD. Most of the time I don't need or even want to watch a specific movie. I just want an entertaining one I haven't seen yet. This does not strike me as unique so the comparison is more than valid for a large percentage of viewing and how folks "chose their entertainment value".
Agreed, simple argument or not, it is all about perceived value. The "suck it up bitch, you are paying for the convenience" argument seems like the simplistic one. 100 million downloads for movies isn't really that impressive; Netflix streams that in a month. They ship more dvds than that by mail (1 billion by 2007). If I feel like I am being ripped off for no good reason, I am not going to pay. Now I'll get my movies from kiosks, libraries etc but others when they feel they are being ripped off feel far less sympathetic when they pirate your movies (the old you rip me off, I rip you off argument) With iTunes movie and TV rentals, I feel like I am being ripped off. Streaming should be cheaper for all kinds of reasons, but I am being charged 100% more than I think I should be paying... 100% more than I would pay at a dvd rental store or a kiosk. What I think I should be paying is all that really matters to me... the consumer.
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Originally Posted by alandail
They aren't even targeting the same use. The only thing they have in common is they stream movies.
They are targeting home and mobile entertainment. They compete for revenue and usage. In both areas iTunes now trails Netflix.
Apple currently includes Netflix it's because the studios won't let them offer SVOD out of fear.
Apple tends to commoditize content to a certain level to make their hardware ecosystem attractive. While they insure that the content producers are profitable they certainly make sure that the content is commoditized. Something that media content providers don't want to happen.
Take games. Traditional hand held games are $20 to $40. iPad/iPhone games are $0.99/$19.99 with probably an average of $4.99. Same for music. $0.99 individual songs are profitable but not like the old album sales. These content producers make money and it is in Apple interest that they do so and are healthy but the lions share of the immediate revenue ends up in Apple's hands in the form of hardware sales.
They haven't been able to do that to TV or movies. So Apple uses Netflix for this for now. Eventually content producers will cave and we'll see much better pricing for iTunes VOD.
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Originally Posted by GMHut
How many people have an AppleTV? Percentage of marketshare does not preclude profitability or the value of the service to the niche market customer the smaller market share holder offers.
AppleTV volumes are so-so. aTV margins are so-so. aTV ASPs are meager (only $99). iTunes video profitability is so-so. It's profitable, yes. But as Cook pointed out, very very different from other Apple offerings. A product in any other category that was this so-so would have been axed.
iTunes doesn't just exist on aTV but also iPod, iPhone, iPad and Mac. So your implication here that iTunes VOD lacks potential customers because it is limited to the aTV is untrue. It is niche but not because there isn't a critical mass of potential users. It is the offering itself that is weak IMHO.
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I can offer myself as an example to answer your question.
It does? What do you think the question is?
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You are evaluating the price of an iTunes rental in isolation as if everyone's choice for a particular movie/TV show at a particular time they want to view it, is a choice betweens iTunes and nothing else, or netflix and nothing else, etc. That's not the way media is consumed. Again, "very expensive" is relative to the availability of the particular title you want to watch, when it's available, and how available it is on other sources. One more time, pricing models are not as simplistic as you insist they are.
The way most folks I know seem to pick what to watch is to watch whatever happens to be on cable vs renting something specific. That strikes me as the way media is consumed and not some laser like zeroing in on a particular movie.
One more time...pricing models are whatever they are but consumers decide what represents a good value and vote with their dollars. Those dollars appear to be going for the streaming whatever they can get when they flip on the TV vs your "I wanna watch X and therefore I'll only watch X even if I have to pay $5 on iTunes".
Even in your example iTunes is the last step: "If I happen to have the time to watch a movie, and I've seen everything currently on premium cable channels and there's nothing on netflix I wanna see at a particular time"...
Given the data provided it appears that most folks don't get that far. Probably because they know in a month it'll appear on cable or netflix for "free".
They probably have AT&T u-verse. I also have an AE router & AppleTV, quality is fantastic for Netflix streaming.
I saw this mentioned on some other site and I remembered your comment. It sounds like they've been working on it for a bit:
http://blog.netflix.com/2012/06/announcing-netflix-open-connect-network.html
I wouldn't be surprised if the AppleTV margins were in line with other Apple products, especially when you get the economies of scale going. Raspberry Pi is a single board ARM computer with HDMI out, network port, a USB jack and costs $35 a piece. I think it's possible to add a shell, throw in a remote, power supply, cable and still be as profitable as any other Apple product, especially given the million+ unit runs.
AppleTV seems to demand more bandwidth for the same service, and I can't find any setting to fix that. My Netflix streaming works considerably better on a PS3. My AppleTV often halts to buffer several times for a 20 minute episode, the PS3 sometimes, but at most once. So yes, if you give it ideal internet service, but not everyone is working with the ideal. Other products seem to work better with non-ideal situations. I would say PS3 is more robust for this use.
I prefer to stream movies and TV shows instead of buying them. I own about five DVDs. They were bought when I wasn't willing to wait for a video stream version. I don't think I've watched more than one of them twice. There are less than ten movies I would want to own on DVD and I still haven't gotten around to buying them. That is how little I really want to own DVDs. I love movies and some TV shows. I watch every day and night.
Movies can be like music to some people. They are just as much fun to watch numerous times as they are to see the first time. I'm not that way with movies. Netflix is my favorite source for video content. This is my second favorite streaming source for quality: http://xfinitytv.comcast.net/?cmpid=rdrct_td ; My third choice is an aggregate site: http://www.free-tv-video-online.me/internet/. After that I just go to TV networks to watch shows that aren't available on the others.
I guess I'm a little confused here. How can Netflix compete with Apple in the Movie business when Apple supports Netflix on the Apple TV. So, the more Apple TVs they sell the more access Netflix has to their customers. Do you think if they saw them as competitors that the Netflix app would be on their device. I'm going with NO!
have anyone tried to stream and download movies from http://www.onchannel.net movie sharing website? this site has alots of new movies psted each day with free external streaming links. it alos has tv shows in full lenght added everyday.
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Originally Posted by Smallwheels
I prefer to stream movies and TV shows instead of buying them. I own about five DVDs. They were bought when I wasn't willing to wait for a video stream version. I don't think I've watched more than one of them twice. There are less than ten movies I would want to own on DVD and I still haven't gotten around to buying them. That is how little I really want to own DVDs. I love movies and some TV shows. I watch every day and night.
Movies can be like music to some people. They are just as much fun to watch numerous times as they are to see the first time. I'm not that way with movies. Netflix is my favorite source for video content. This is my second favorite streaming source for quality: http://xfinitytv.comcast.net/?cmpid=rdrct_td ; My third choice is an aggregate site: http://www.free-tv-video-online.me/internet/. After that I just go to TV networks to watch shows that aren't available on the others.
another great alternative to stream movies legally is http://www.onchannel.net