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The much-discussed accord between Warner and Netflix could have an immensely positive effect on third-party digital distributors allied with Warner. This comes from Ralph Schackart, a digital media analyst with William Blair & Co., who says that the 28-day, sales-only window Warner has given itself could be beneficial for Blockbuster and nascent digital stores from companies such as Best Buy. Additionally, Schackart sees the deal as a boon for companies such as Samsung, Toshiba, Lenovo and NVIDIA, whose products utilize CinemaNow movie software.

According to Home Media Magazine, Schackart said that “technological improvements with CinemaNow have reduced per-title distribution costs from 5 cents to 10 cents, compared to 85 cents per movie a year ago”. Schackart continued:

“Consumers wanting to rent a Warner Bros. movie day-and-date with the DVD release will be able to rent at a Blockbuster store or digitally through a-la-carte digital models that are significantly more profitable to studios than Netflix or kiosk operator Redbox,”

Is what’s good for the studios and these distributors also good for consumers, Insiders? Give us your opinion in the comments.

[via Home Media Magazine]

3 Responses to “Analyst: Warner/Netflix Deal Good for Digital Sales”

  1. Visitor [Join Now]
    Vishal [visitor]

    The end result will be an increase in piracy.

    • Visitor [Join Now]
      Rich [visitor]

      Why would Netflix subscribers turn to piracy with the 28-day delay? Subscribers have already bought into the subscription model; they are willing to pay $x/month instead of pirate to access new(er) release movies. With the 28-day delay, queues will merely shift 28-days. You’ll be adding the new(er) Warner movies for later/lower in your queue.

      Some have argued that the deal might actually mean new(er) releases getting to subscribers sooner. With the deal, Netflix gets more copies for less. More copies means more to go out to subscribers … 28 days later.

      Those who would pirate because of the 28-day delay would more than likely have pirated even if there was no delay.