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DVDs still preferable over downloads

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Old 02-05-2009, 04:13 PM   #1  
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DVDs still preferable over downloads
FUTURE OF PACKAGED MEDIA: Retailers look to grow Blu-ray sales


Although movie downloading often is portrayed as all the rage, consumers feel most comfortable with physical discs, according to retail participants at Wednesday’s Future of Packaged Media conference here.

The consumer press has zeroed in on falling DVD sales, as well as the troubles of Circuit City among others, to say that people are turning away from traditional bricks-and-mortar supplied entertainment. But people continue to attach specific advantages to packaged media, note retailers. Downloading is cumbersome compared to DVD purchasing, and there is an appreciation for discs’ simple storage capabilities.

“Packaged goods solve a lot of problems for people, and it’s a well-liked medium,” said Mitch Lowe, chief operating officer at kiosk operator Redbox. “There is the thought that we should have more technology, but that isn’t the reality for consumers. … If you get an item digitally, where do you store it? How many times have you lost something on your computer? You don’t really own anything in your mind.”

Mark Fisher, executive VP at the Entertainment Merchants Assn., added that there are too many steps to enjoy a seamless downloading experience.

“There are roadblocks to consumers who are used to just popping in a DVD and having it work,” he said. “As much easier as downloading is becoming, you first need to find [the file] to download, then you need to make sure you get the full file, and then you have to find out how to get that content to your TV. And all of that doesn’t work all the time.”

Many retailers hope that Blu-ray will soon offset softening standard-definition DVD sales, creating an overall healthy packaged business.

Secondary-market specialist Hastings Entertainment has found surprising strength with Blu-ray, which was thought to generally appeal to big city early adopters.

Studios believe Hastings has carved out a relatively high percentage of Blu-ray software users among its customer base compared to other retail accounts, Hastings president/CEO John Marmaduke said during his Wednesday keynote.

Hastings' Blu-ray consumers account for a little less than 10% of its base, Marmaduke told VB following his speech.

“We want to be a pioneer [in Blu-ray] for small town America,” Marmaduke said, noting Hastings' commitment to offering low-priced Blu-ray hardware to spur format adoption. Over the holidays, the chain offered $179 Blu-ray set-top players, which generally sell for $250. Hastings also is working to provide a large selection of Blu-ray titles to rent and buy.

Some tips were given to improve the packaged media world.

Jim Donio, president of the National Assn. of Recording Merchandisers, said retailers could enhance how consumers find products to buy. Currently, a big benefit to Amazon.com and other Web sites is the technology to automatically recommended like-minded product after every customer purchase.

“In our research, we find that people are inundated with choice,” said Donio. “Physical retail can be a filter. … There are 76 million baby boomers, and 70% of them said they like buying physical media. They have lots of disposable income. But they are hungry for an appropriate filter. They feel disenfranchised because they don’t know what’s out there.”

NARM hopes to promote the bricks-and-mortar world by formerly sponsoring Record Day 2009 on April 18. This event, now in its second year, will feature retailers banding together to market themselves as alive and well, even if other stores are consolidating.

“This will remind people that entertainment stores continue to significantly contribute to the economy,” said Donio. “People hear that large entities are going out of business, but that doesn’t equate to every store going out of business.”
Link: http://www.videobusiness.com/article/CA6634867.html
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Old 02-05-2009, 04:31 PM   #2  
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I believe physical media will always be preferable to downloads.
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Old 02-05-2009, 04:38 PM   #3  
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I believe physical media will always be preferable to downloads.
We agree to disagree.
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Old 02-05-2009, 08:57 PM   #4  
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I have to ask--if one is only going to rent a movie to see it and not own it, in what way is physical media preferable to a download (assuming you can select and download/stream the movie directly from your HDTV or STB--which is what every CEM is planning for the next year).

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Old 02-05-2009, 09:03 PM   #5  
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I have to ask--if one is only going to rent a movie to see it and not own it, in what way is physical media preferable to a download (assuming you can select and download/stream the movie directly from your HDTV or STB--which is what every CEM is planning for the next year).
Higher quality, cheaper, super simple.
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Old 02-05-2009, 09:26 PM   #6  
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Higher quality, cheaper, super simple.
Seems like some good reasons to me!

I will add a few. Low bandwidth Internet connection. Caps being put in place by Internet providers. DRM.
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Old 02-05-2009, 09:32 PM   #7  
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Higher quality, cheaper, super simple.
None of which have any real merit.

There is no reason whatsoever that downloads won't provide excellent quality (AppleTV's HD downloads are regarded as superior to cable HD VOD and HD OTA, for example). Not as good as Blu-Ray? Who cares--the majority of Blu-Ray discs aren't as good as the Best Blu-Ray discs anyhow. Consumers don't care about theoretical quality. If many of them think upscaled DVD looks just fine, they will also be thrilled with a 720p download.

Cheaper? Perhaps if you have a NetFlix account and order lots of movies. NetFlix, does not work at all for me, as we don't plan our movie viewing in advance, don't rent enough movies a month to make it worthwhile and aren't about to wait for something to come in the mail when we do decide to watch a movie. There is no question at all that downloads would be cheaper per year for my family than a NetFlix account and given that NetFlix only has about 8.2 Million subscribers, while there are around 100 Million households in the US with DVD players, I suspect people like me are in the majority.

Simpler? What is simpler than picking up your remote, pointing it at your TV and scrolling through the thumbnails of movies available, then hitting "enter" when you find what interests you? You can do that right now with AppleTV and by the end of the year, you'll be able to do it on just about any HDTV you buy, not to mention many DVD/BD players and STBs.

(I should note that I don't draw much of a distinction between streaming and downloading when talking about rentals.)
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Old 02-05-2009, 09:43 PM   #8  
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None of which have any real merit.
Price and quality have not merit? Umm.. Okay..

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There is no reason whatsoever that downloads won't provide excellent quality (AppleTV's HD downloads are regarded as superior to cable HD VOD and HD OTA, for example). Not as good as Blu-Ray? Who cares--the majority of Blu-Ray discs aren't as good as the Best Blu-Ray discs anyhow. Consumers don't care about theoretical quality. If many of them think upscaled DVD looks just fine, they will also be thrilled with a 720p download.
Sure some people don't care about the difference between a low bitrate 720p download vs a high bitrate 1080p disc, but some people do. But I can tell you that people do equate quality and price together. Blu-Ray rentals are cheaper than HD downloads and offer better quality. BTW, you also get better audio and access to extra features for the Blu-Ray vs the download.

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Cheaper? Perhaps if you have a NetFlix account and order lots of movies. NetFlix, does not work at all for me, as we don't plan our movie viewing in advance, don't rent enough movies a month to make it worthwhile and aren't about to wait for something to come in the mail when we do decide to watch a movie. There is no question at all that downloads would be cheaper per year for my family than a NetFlix account and given that NetFlix only has about 8.2 Million subscribers, while there are around 100 Million households in the US with DVD players, I suspect people like me are in the majority.
Okay, so Netflix does not work for you, but what about the millions and millions of people that do have Netflix and Blockbuster monthly subscripton accounts? They don't count?

Taking the subscription model out of the equation it costs me $3.99 before tax to rent brand new Blu-Ray releases at Blockbuster. That is still cheaper than downloads. Redbox has started offering Blu-Ray rentals at some locations for $1 per night. Downloads cannot touch that.

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Simpler? What is simpler than picking up your remote, pointing it at your TV and scrolling through the thumbnails of movies available, then hitting "enter" when you find what interests you? You can do that right now with AppleTV and by the end of the year, you'll be able to do it on just about any HDTV you buy, not to mention many DVD/BD players and STBs.
This is a big advantage for downloads. Kinda. If you have a low bandwidth broadband account it could take hours for the movie to download. And you can always have Netflix or Blockbuster deliver your BD movie to your doorstep. Pretty convenient too.

(I should note that I don't draw much of a distinction between streaming and downloading when talking about rentals.)[/QUOTE]
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Old 02-05-2009, 09:49 PM   #9  
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None of which have any real merit.

There is no reason whatsoever that downloads won't provide excellent quality (AppleTV's HD downloads are regarded as superior to cable HD VOD and HD OTA, for example). Not as good as Blu-Ray? Who cares--the majority of Blu-Ray discs aren't as good as the Best Blu-Ray discs anyhow. Consumers don't care about theoretical quality. If many of them think upscaled DVD looks just fine, they will also be thrilled with a 720p download.

Cheaper? Perhaps if you have a NetFlix account and order lots of movies. NetFlix, does not work at all for me, as we don't plan our movie viewing in advance, don't rent enough movies a month to make it worthwhile and aren't about to wait for something to come in the mail when we do decide to watch a movie. There is no question at all that downloads would be cheaper per year for my family than a NetFlix account and given that NetFlix only has about 8.2 Million subscribers, while there are around 100 Million households in the US with DVD players, I suspect people like me are in the majority.

Simpler? What is simpler than picking up your remote, pointing it at your TV and scrolling through the thumbnails of movies available, then hitting "enter" when you find what interests you? You can do that right now with AppleTV and by the end of the year, you'll be able to do it on just about any HDTV you buy, not to mention many DVD/BD players and STBs.

(I should note that I don't draw much of a distinction between streaming and downloading when talking about rentals.)
Many people still prefer physical media. They love the attraction of collecting something with substance that they can share at a moments notice or take with them to a friend's house, or even lend to friends. I personally rather own instead of rent my "favorite" movies I plan to watch again. Other movies I rent, and may DL/stream whenever it's quality and affordability meets my requirements.

I have no doubt that when streaming rentals becomes affordable with desent quality, then this may attract some DVD/BD collectors. However, I see physical media being with us for some time yet.
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Old 02-05-2009, 10:14 PM   #10  
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Price and quality have not merit? Umm.. Okay..
The concepts have merit. Holding them up as a reason that consumers will prefer physical rentals to downloads does not have merit. Rental downloads/streaming will look great, be cheap, be simple and be even more convenient than physical media. Nobody is complaining about any of those issues with NetFlix streaming now--the complaint is limited content. And NetFlix streaming is growing. And more and more disc players are offering streaming access. Obviously the CEMs see where the market is heading.

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Sure some people don't care about the difference between a low bitrate 720p download vs a high bitrate 1080p disc, but some people do. But I can tell you that people do equate quality and price together. Blu-Ray rentals are cheaper than HD downloads and offer better quality. BTW, you also get better audio and access to extra features for the Blu-Ray vs the download.
Blu-Ray fans really need to get a grip on the fact that Blu-Ray and HD are not synonymous in the mind of consumers. Far more consumers get HD via OTA and cable than Blu-Ray and HD downloads are superior to either OTA or cable. Consumers will be perfectly happy with the quality.

AppleTV HD rentals start at $3.99. Where do you get Blu-Ray rentals for significantly less than that (and don't say NetFlix)? Most consumers won't notice better audio quality through the speakers built into their HDTV--which is what the vast majority of consumers use for audio reproduction of their videos.

I thought Blu-Ray fans said special features don't really matter--that's why it's not important that all BD players (especially the inexpensive ones) are not Profile 2.0 compliant

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Okay, so Netflix does not work for you, but what about the millions and millions of people that do have Netflix and Blockbuster monthly subscripton accounts? They don't count?
Sure, they just don't count nearly as much as the 72 Million DVD-owning US households that don't subscribe to NetFlix and prefer to pick their movies when they want them and as few or as many as they want.

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Taking the subscription model out of the equation it costs me $3.99 before tax to rent brand new Blu-Ray releases at Blockbuster. That is still cheaper than downloads. Redbox has started offering Blu-Ray rentals at some locations for $1 per night. Downloads cannot touch that.
Downloads are just getting started. By the end of 2009 it will be a totally different world, with tons of CEM gear like HDTV's , STB's, DVD players and Blu-Ray players ready out of the box to stream or download and the majority of studios and ISP's offering services. New high-efficiency codecs (that will likely download with the movie) will decrease bandwidth requirements and download times. It's all in the works.

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Originally Posted by ack_bak View Post
This is a big advantage for downloads. Kinda. If you have a low bandwidth broadband account it could take hours for the movie to download. And you can always have Netflix or Blockbuster deliver your BD movie to your doorstep. Pretty convenient too.
Not to a generation that grew up on instant access to the music they want via MP3 downloads. Going to a store or waiting for the mail is not convenient at all and they have clearly stated with their wallets that convenience is a higher priority than ultimate quality.

Last edited by BobY; 02-05-2009 at 10:38 PM..
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Old 02-05-2009, 10:18 PM   #11  
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Many people still prefer physical media. They love the attraction of collecting something with substance that they can share at a moments notice or take with them to a friend's house, or even lend to friends. I personally rather own instead of rent my "favorite" movies I plan to watch again. Other movies I rent, and may DL/stream whenever it's quality and affordability meets my requirements.

I have no doubt that when streaming rentals becomes affordable with desent quality, then this may attract some DVD/BD collectors. However, I see physical media being with us for some time yet.
I tried to make it clear I was talking about rentals.

Owning movies via downloads is fraught with problems and will have limited appeal until issues with mass storage, portability, DRM, etc. are ironed out.
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Old 02-05-2009, 10:28 PM   #12  
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Many people still prefer physical media. They love the attraction of collecting something with substance that they can share at a moments notice or take with them to a friend's house, or even lend to friends. I personally rather own instead of rent my "favorite" movies I plan to watch again. Other movies I rent, and may DL/stream whenever it's quality and affordability meets my requirements.

I have no doubt that when streaming rentals becomes affordable with desent quality, then this may attract some DVD/BD collectors. However, I see physical media being with us for some time yet.
Sure - as the HV market is s l o w l y shifting from DVD to BD - at the same time the market itself is shrinking. And some of that shift is going to downloads/streaming which like BD is also a growing delivery system.

You know where the big problem is Bravestime?

The mentality of some here who believe because they want the very best in PQ and AQ - that everyone else is supposed to feel the same way. And that's just flat out wrong, especially as we talk about the masses.
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Old 02-05-2009, 10:36 PM   #13  
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Any student of Consumer Electronic history knows the overwhelming majority of consumers never pick ultimate quality over value (value being a balance of cost, quality, features and convenience).

The CE market is littered with unsuccessful products and formats that were better than they needed to be to satisfy consumers and cost more as a result (and, in most cases, SONY was the originator ).
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Old 02-05-2009, 10:48 PM   #14  
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This isnt even about quality vs. better quality. The study is just pointing out that for the most part people just dont mind having physical discs, and that mentality will still hold as the market slowly crawls towards HD content. These guys arent alone in their thoughts.

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Old 02-05-2009, 11:04 PM   #15  
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It doesn't take rental into account, it just lumps everything together.

I wouldn't dispute for an instant that if you want to own a movie, discs are the way to go for a long time.

But if you want to rent--I simply don't believe that renters have any particular attachment to shiny plastic discs and won't give up that model in an instant for something that is good enough, easier, more convenient and quicker even if absolute quality is not as good.

They also show the total income for DVD plus BD remaining flat, which wasn't true from 2008 to 2009 and isn't likely to be true going forward--I haven't seen a single source that has said increasing Blu-Ray sales have picked up the slack from decreasing DVD sales. Most of the studios had huge drops in income and are expecting things to worsen.

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