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Netflix vs. Blockbuster Revisited
Thomas Hawk writes "Exactly one year ago at thomashawk.com Davis Freeberg debated Wall Street analyst Michael Pachter regarding the future of the online DVD rental world. Freeberg maintained that Netflix was the clear and obvious choice for a winner while Pachter predicted that in the next 12 months Netflix would significantly underperform Blockbuster. Now another look one year later at the competitive landscape in the DVD market. Pachter is nice enough to continue the conversation and even admits in hindsight that he made a mistake regarding his prediction on Netflix vs. Blockbuster for the year past -- but Pachter still maintains that Blockbuster has the upper hand over Netflix in the coming year ahead. Freeberg, of course, thinks he's wrong once again and that Netflix will continue to dominate as the leader of this market. "
Infinite rentals, no due dates, a massive library, and you can rent from your very own chair without ever leaving your house. What's blockbuster got to top that?
I would like to use an online rental service like Netflix (more specifically, their Canadian equiv. zip.ca) instead of Blockbuster, but I don't want to be locked in with their subscription model.
If they would introduce some kind of pay-as-you-go scheme, that would be ideal. I don't want to pay the monthly fee as in any given month I may only rent one movie -- or none at all.
boxlight
Which one did I just dump on Saturday: Blockbuster
Which one did I just pick up (again) : Netflix
If that represents the trend, the guy's wrong. If it doesn't, I just posted virtually useless info!
I want both of them to keep fighting it out... for a very long time.
Because when video rental services compete, I win.
Three cheers for competition!
"All great wisdom is contained in .signature files"
Just because "Teenage Exorcist" is waiting in my mailbox when I get home doesn't mean that I'm going to feel like watching it tonite.
I think you're doing it wrong. "Netflixers" I know do it like this -- get the DVD in the mail, copy it to your PC with something like DVDShrink, send the DVD back right away so you get the next item in your queue sooner.
Then later when you feel like watching the movie, burn it to a DVD+/-RW, watch it, then delete the file off your computer.
This may be walking the tightrope of "fair usage", but that's the reality of how people I know are using this sort of service.
boxlight
http://www.redbox.com/ They have some they everone else doesn't... Cheap pay as you go rentals. And you can get fries with that!
I found eDonkey significantly outperforms Netflix, at least for me.
I was once a subscriber, but I dropped Netflix back when they went from $19.99 to $23.99/mo.
"Since the launch of Blockbuster's online dvd rental program in August 2004, they have added 1.3 million customers, but over the last 6 months alone, Netflix was able to add almost as many subscribers. Each customer that Netflix acquired represents pure growth for the company, but of Blockbuster's 1.3 million subscribers, how many of them represent former retail store customers? "
The last few times I've been in my local Blockbuster, they have been doing hard sells on their online service to every customer. They talk about how convenient it is, how much it will save you, blah blah blah.
I seriously doubt Blockbuster has gotten very many new customers at all to their online service. I think most of them were conversions from in-store customers.
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
The longterm winner is the one that can first come to market with a downloadable delivery method.
It doesn't have to be super fast (you can choose your download in the morning and have it ready tonight), it doesn't have to be unlimited (people will pay $2-4 like they currently do), and it doesn't have to be open (most people don't care about DRM). It just has to be mostly reliable, current blockbuster hits, and very very easy to use.
Whoever that is (Netflix, Hollywood, Blockbuster, Comcast, or NewCompanyYetToBeNamed) will most certainly reign while the others scramble to catch up.
-David
However, a queue of 40+ movies, all on "delayed availability", with nothing shipping to me, told me they didn't want my money anymore.
Right you are. Why would they want your money when it is totally obliterated by the cost of doing business with you?
They made a choice. You made a choice. And you both rode off into the sunset.
"Yes, except that if you have Blockbuster Online you get coupons for free in-store rentals (either 2 per month, valid for the whole month, or 1 per week, valid only for the week). Therefore, you can satisfy your spur-of-the-moment movie fix without paying anything extra."
I have never understood how paying a monthly fee equates to free. Free is only free if you don't pay for it. You are paying a monthly fee, therefore you are getting nothing free. You only call it free because Blockbuster propaganda has billed it to you this way and you have taken their marketing bait hook, line, and sinker. I'm not trying to be hostile. Just understand that you pay a monthly fee for those 2 in store vouchers. You're paying for them.
"NetFlix throttling is well documented and even admitted to by NetFlix in their TOS."
BS. I just read their terms of service. It says nothing of the sort. It does say that it prioritizes lower volume customers, but that is something entirely different than "throttling".
"1. They lied about what day they received a DVD back from me (adding 1-2 days to the time it takes for the DVD to show up as being returned on their site)"
"3. They lied about what day they shipped a DVD back to me (for example, saying they shipped the DVD on Monday but actually shipped it on Tuesday or Wednesday)."
Speculation. There is no way short of you working at Netflix and doing the recieving yourself that you could know when recieved or shipped your movies. Given the HUGE number of extreamly heavy users of Netflix that report next day shipment to and from Netflix, it seems much more likely that your local post office is the culprit. A perfect example is me and my father. He lives 20 miles from me, and rents fewer movies. He keeps his movies usually about 2 days. I always send mine back the next day. I always have a one day shipping time, and he always has 2 day shipping times. So, what does he do? He whines about throttling. Really, if Netflix were throttling, wouldn't the person that gets MORE movies be the one that gets throttled? Your examples indicate that the throttling is a myth. They don't confirm it.
"2. They lied about the availability of new releases (I would see "Very Long Wait" while a new subscriber would see "Available Now" for the exact same DVD)"
This is in the TOS. They give priority to lower volume members. They have to give priority to SOMEONE. It seems to me that if you are getting 10 movies that you want to watch a month, and another guy just has one, the other guy should get the one he wants. There are other just as fair ways of prioritizing, but the one they chose is perfectly fair. Combine that with IT IS NOT THROTTLING. Throttling means that you are slowing down, in this case, shipments. If they are still sending you movies they are not throttling.
So basically you helped convince me that the throttling is a myth, and that people that live in poor quality postal areas are misdirecting their wrath.
This may be walking the tightrope of "fair usage", but that's the reality of how people I know are using this sort of service.
It's more a licensing issue than fair use. I'm sure you expressly agreed to not do something along the lines of copying it when you rented it, so it doesn't matter if there is fair use, you've breached your contract with them.
What?
No tightrope, no fine line, just plain illegal. Sorry. Even if you owned the DVD, you violated the DMCA by copying it since there aren't many official DVDs out there which aren't encrypted, but, since you do not own it you do not have the legal right to a backup anyway. In particular, the law stated that it is only supposed to be possible for one copy to be in use at the same time, never two or more at the same time (without further licenses or a bulk license that is.)
Don't get me wrong, I don't actually disagree with you entirely. Users SHOULD be able to do this sort of thing legally. Or at least they should provide some more reasonable means. My grandmother not so very long ago used a library service to get a series and they used a crappy system not so dissimilar from the netflix system. She received her videos over VERY long delays and 100% random order. It made it impossible to watch the series (it was a drama, not a comedy or something, so order mattered.) This is just useless and she has since stopped the system. This isn't as much of a problem with movies like most get from such a service, but, it does demonstrate on a larger scale just how unacceptable this almost completely random system really is. You should be able to pick what you want when you want it.
Watch out for TV over IP. People like TiVo are even already looking into changing content and such. If a service allowed a user to pick anything they want to see when they want to see it, people would pay more to use that service and none at all for something unreliable like netflix.