If you are a movie studio, and you know consumers are revolting against your stance against $1 rentals and 28-day delays on companies like Redbox and Netflix, what do you do?
Charge more for the same thing, of course!
OK, to be fair, it is not exactly the same thing. So, what is it that you get for your $30? The ability to watch a movie while it is still in theaters, a month or more before it comes out on DVD. Revolutionary and awesome, right?
Here is a quote from NewTeeVee:
Offering a new, higher-priced VOD service may seem like a good idea to the studios — after all, they’re creating a new product with higher margins and trying to appeal to an audience that is more inclined to stay at home and view content on demand than go to the theater. But by selling it at such a premium, they’re not appealing to the budget-conscious folks that they’re trying to appeal to at all. And meanwhile, they’re annoying their usual distributors in the process – all of which sounds like a recipe for disaster.
I couldn’t really agree more with this. Of course the studios like this idea, as it has the potential to help them recover from falling profits in the DVD arena. But, clearly the main audience that has caused this decline in sales are those who rent from Redbox and Netflix – and these are the exact people who are not going to spend $30 to watch a movie at home. Am I wrong on this?
What the studios are doing here is trying to create a whole new window, one that I believe could be useful, but is currently broken. The reality is, only the studios win with this one, as nearly all of their distribution partners lose, especially movie theaters. If the studios move in this direction and are successful, the same thing that just happened to Blockbuster will start happening to movie theaters.
What are your thoughts? Would you like the ability to watch a movie at home before the general DVD release? Would you pay $30 to do so? And, do you agree that movie theaters would suffer if this was successful? Let us know your thoughts in the comments.