Netflix Will Delay Renting New WB Releases

DesertBlade tips the news that Netflix will delay renting new releases from Warner Brothers for 28 days, and adds "Luckily I am so far behind in my movie watching that I will probably never catch up anyway." "It's part of a strategy by several studios to create staggered releases of DVDs so that the most profitable transactions are available first and cheaper rental options take effect further down the road. The move could be copied by other studios, forcing consumers to wait nearly a month if they want to rent popular movies from Netflix. ... The studio is hoping that the four-week window will push consumers interested in watching movies at home to buy the DVDs or pay a premium to rent them from stores like Blockbuster or from Internet and cable video-on-demand services. Warner Bros. already imposes a 28-day window on $1-a-night kiosk firm Redbox."

Comments

What a great idea!

[Pojut]

Artifically deny your customer the ability to buy your product. They'll love you for it!

Feh.

Re:What a great idea!

[NFN_NLN]

"The studio is hoping that the four-week window will push consumers interested in watching movies at home to... pirate the movie instead."

Re:What a great idea!

[Moryath]

Yeah. They used to wait over a year before you could even get the VHS... and we hated the hell out of that.

Artificial scarcity doesn't work. Period. If only they could learn this.

Re:What a great idea!

[Anonymusing]

On the plus side: "Netflix will use the savings to expand its stock of the studio's DVDs and triple the number of Warner catalog titles it provides through its online streaming option."

In other words, you won't have to wait for the DVD so much -- you'll be able to watch it on your computer. Certainly, the newest releases won't be available that way, but still... anything that expands the (legal) streaming movies options is a good thing.

Re:What a great idea!

[AthanasiusKircher]

Mod parent up. This is an important caveat.

I'm not that happy with the precedent this sets, but I get many of my movies through Netflix streaming these days, which is improving all the time. There are still hundreds of great classic movies I want to see, and I'd prefer an emphasis on those (which tend to be what is showing up on Netflix streaming) rather than getting the most recent crap out of Hollywood as fast as possible.

If you really want to see the damn movie a couple weeks sooner, buy the DVD... or better yet, go to the theatre when it's playing.

There are various trade-offs here, but there are lots of customers who don't use Netflix only as a replacement for the "latest releases" section of Blockbuster.

Re:What a great idea!

[jgtg32a]

Netflix agreed to this because they are getting a discount on their DVD purchases and letting them cut costs.
 
Netflix also doesn't have the same business model that BlockBuster has I pay $x a month and I get unlimited rentals, the less I use the service the better it is for Netflix.
 
WB's research shows that a majority of their sales take place in the first 4 weeks. I assume that they did an analysis and found out that the discount that they give to Netflix will be outweighed by the additional sales.
 
Netflix has no risk in this deal, actually they may even have a bit to gain, they only buy a limited number of each movie. If one of Netflix's customers buys a movie because they were too impatient to wait for it to appear on Netflix; Netflix now has slightly better customer approval because there will be slightly less of a wait time on some of the new releases.

Re:What a great idea!

[SCPRedMage]

Pirating is just so 19th century.

Perhaps. But the hats are AWESOME.

Re:What a great idea!

[PCM2]

I believe the term was "priced for rental." The idea was yes, the prices were absurd -- for anyone but a VHS rental business.

The economics of VHS tapes were different, though. Unlike DVDs, comparatively few people tended to actually go out and buy them, bar a few "core" titles (Disney movies for the kids, Star Wars, Godfather, etc.) VHS tapes were bulky and not easy to store, their packaging tended to look kinda crappy on your shelf, and their picture quality really was not good. Not only did they tend to wear out just from playing them -- and occasionally your VCR would outright destroy one -- but storebought tapes weren't that great quality to begin with. Remember, this was an analog tape medium, and it was in the manufacturers' interests to duplicate them for as low cost as possible. Often this meant they were made from low-quality materials and were duplicated on high-speed equipment. From a collector's/fan's standpoint, all but a very few were 4:3 pan and scan -- so between that and the poor resolution, the only real way to see your favorite movies was to wait for them to come to a local second-run theatre. So it became a kind of Catch-22 -- because VHS tapes were never that attractive, studios were never really able to get the economies of scale that would drive the cost of VHS releases down to where mainstream customers would pay for them.

People did buy laserdiscs, though, and those collectors were among the first to jump on the DVD-buying bandwagon. When regular people got word that DVDs gave you picture quality comparable to laserdiscs without all the disc flipping and swapping, DVD sales exploded. Way back in 2001, when cheap VHS tapes had become more common and DVDs were fairly new, revenue from VHS sales was still far less than that from VHS rentals -- but it was also less than the revenue from DVD sales, even back then. (This according to the Video Software Dealers Association.) I honestly think enough people buy DVD releases regularly enough that this waiting period won't be that big of a deal -- especially in the age of home theater. Even if you have to pay $20 to buy the disc, it's still cheaper than taking a date to the movies.

Re:What a great idea!

[lgw]

That's simply wrong. With the exception of "phonorecords", if you buy a DVD, book, video tape, etc, you can rent or give it to others, no special license needed. Copyright law still makes at least a little sense in some areas.

Re:What a great idea!

[ottothecow]

Where is the -1 incorrect mod?

This is flat out wrong. First sale doctrine gives you the right to do whatever you want with the physical disk (including rent it to people from a vending machine). The content isn't yours, you still can't do public performance or make copies to rent but the original disk is yours.

The reason you pay more for a rented disk that you lose is probably because they like to gouge you. Also, sometimes "rental" copies are different, often they might have a different set of previews and a lack of special features (but get sold at an initial discount with a higher later replacement cost). In the VHS days, the expensive tapes were actually nicer than the retail copies--blockbuster would buy a couple copies on the expensive tape for long term rental and a bunch on retail quality (fast degrading) tape that they would sell off after new-release status was over.

Please don't spread incorrect info about things like first sale doctrine...it is a very important part of copyright law that a lot of companies would like to see go away and that will be easy if people already think it doesn't exist.

Re:What a great idea!

[zindorsky]

Artificial scarcity doesn't work. Period.

I don't know ... seems to work pretty well for the diamond industry.

Re:What a great idea!

[ByTor-2112]

That's because there are more vaginas involved in the application of diamond products than pirated movies.

Re:What a great idea!

[nine-times]

Agreed. I know that lots of people around here are probably keeping up on all the latest and greatest sources for pirated movies and TV shows, but for most people, it's simply too much of a hassle. I sincerely think that movie studios and TV networks need to learn that ultimately most people aren't really willing to pay for "content". Rather, people are willing to pay for convenient, easy, and reliable access to that content. If they make it as more of a hassle to get the content legally as it is to get it illegally, and too expensive to boot, then they'll lose out on that revenue. I don't say this as someone who approves of pirating, but sometimes it doesn't do you much good to disapprove of reality.

But anyway, I'm just not sure it matters. I don't even know when DVDs are released most of the time. I only know when Netflix tells me that the DVDs will be available. Move that date forward a month, and I probably won't notice.

Re:What a great idea!

[Chris Tucker]

"I do not download movies or songs from torrent sites because the risk is too high."

Too true!

If only there was SOME way to use the net to safely download the latest.

What news this would be to groups of people seeking an alternative to bit torrent for their binary files.

Oh, Internet! Why have you failed us so?

Re:What a great idea!

[Darkness404]

And I assume you go to the movies once a year?

Not only are there those issues, but the fact that every single refreshment costs five times as much as it would at a store for no more convenience or taste. I mean, I don't mind paying $3 for a really good burger because there isn't a way I could cook it that way and it would turn out that good. Sure, I might be able to make a burger that costs $.50 but I'd still have to make it and it wouldn't taste as good. With popcorn it takes what? 2 minutes in the microwave (less time than you would be waiting in line) and costs five times less. Same with drinks, I can get a 2 liter of soda for $1 or so, it costs more for a small drink at the theater.

If I'm paying $15 per person to enjoy a movie (ticket+popcorn/drink), it better be high quality enjoyment. That means A) Very high definition B) Great sound system C) People actually acting decently. Because, really the masses have determined a view of a movie in standard to be worth $1 for a family (look at how successful Redbox is), plus with a DVD you can pause, rewind, skip through boring parts, etc. that you can't in the theater. But instead when you pay $5 per person for a ticket you get generally pretty low quality, a sound system that is only focused on being LOUD, terrible people, terrible options for refreshments, and when you have to pee midway through the movie there is no way you can get them to pause/rewind it for you.

No wonder piracy/rentals have taken up the way they have.

Re:What a great idea!

[mabhatter654]

it's not about people seeing the movie. It's about established players like Blockbuster willing to pay a larger cut to studios to rent movies first. So the studios are going after Redbox and Netflix to curb the "cheap" rentals that aren't paying kickbacks.

I've noticed at my regional chain store as well more videos are marked "rental" meaning they can't be sold as "used" later. It's a focused effort from studios across the board to create the tiered system. Why "sell" a DVD when they can get the same $15 from a download on Xbox or Apple TV. Why let Netflix or Redbox charge $1 per rental when they can get $4-$5 selling via Apple TV or On Demand Cable. They want to limit the supply, then push the "piracy" card to get the extra demands on consumer electronics.

Re:What a great idea!

[Anonymous Coward]

1990 called... It wants its prices back.

Re:What a great idea!

[BrianRoach]

I'm not sure why this was modded "funny", it's the truth.

Back in the dark ages when VCRs roamed the earth, the movie studios didn't want you to actually own anything but decided that renting was ok ... as long as the rental stores paid $100+ per copy for each tape. This is why it was $5 a frigging day to rent the things.

Same with LaserDisc but it was even worse because most places weren't renting them ( Yes, get off my lawn. I think I paid something like $350 - $400 for the first Star Wars trilogy on LaserDisc. I still have them )

Re:What a great idea!

[rahvin112]

Exactly! You know what RedBox did? Rather than buying from the studio in bulk DVD's in sleeve's for a very slight discount they are buying all their movies at walmart retail then having an employee go through and pull the DVD's out a the boxes and stick them in a sleeve. This hasn't stopped Redbox and won't. Netflix agreed to comply so they can get the license to stream the movies digitally because they are making more money on the streaming than the rentals.

All this is going to do is make RedBox more powerful and give them a bigger market share. This is very foolish of the studio's because Netflix is more on their side then RedBox is.

I'll just wait longer...

[SOOPRcow]

If I really want the movie on dvd I'm gonna buy it anyway. If I was just gonna rent it when it comes out on dvd what makes you think I'll want to buy it instead of waiting 28 extra days? Or at worse one could always pirate it since I'm sure there will be dvd rips on the net. Anyway, this isn't all bad... more streaming stuff :)

Re:I'll just wait longer...

[bit9]

Mod parent up.

I don't know anybody (myself included) who actually keeps track of DVD release dates, much less counts down in anticipation of a DVD being released. Pretty much every movie that I rent from Netflix is something that I've decided I don't mind waiting for, and apart from the 2-3 movies down at the bottom of my Netflix queue that say "Releases mm/dd/yyyy", I literally never have any idea when a given movie is/was/will be released on DVD.

Okay, so maybe not everybody is like me in this respect. Maybe there are hordes of people who will now be thinking to themselves "Damn! I just can't wait another month! I guess I'll have to buy that DVD after all." But I just don't see it happening that way. I don't know anybody who thinks that way. I do know a couple DVD junkies who seem to think they just have to own every movie ever made on DVD, but this isn't going to change their habits anyway.

Re:They are betting that their customers won't car

[MWoody]

How is it a hassle? It IS a delay, but as Netflix is the only place I use to check new releases, it's one I admittedly won't notice. In return, we'll get way more instant-watch movies available, which I don't have to wait for and can watch on my laptop or two of the three consoles in the house.

It's hardly an anti-customer strategy when they make the same choice I'd have asked them to, given the option. The only thing currently stopping Instant-Watch from being really awesome is its subpar selection. And really, if I cared about seeing the movies from Netflix soon after they came out, I'd have seen them in theaters.

Re:They are betting that their customers won't car

[businessnerd]

It might be risky, but I think his assessment of the average Netflix customer is fairly accurate. At least is describes me, a Netflix customer, accurately. Typically, when you hear of a movie coming out that you want to see, you add it to the queue. It's not out yet, but once it is sitting at the top of the queue ready once it becomes available. Except that movie is in high demand, so it says "Long wait" next to it. The second movie in the queue comes instead. But you don't really care, because you still want to see that movie. It's not like I'm a seven year old that has to see THAT one NOW! It will come when it's ready. In the mean time, I have a long list of movies that I have already said I want to see that will ship in its place until it is my turn. At a certain point, you stop paying attention to what's next, and you just accept what arrives in the mail. Any movie that I really really want to see, I would have already seen in the theaters. Avatar was a good example. Wanted to see badly and also appreciated the big screen experience.

The thing that bothers me a little is how Netflix is being prioritized by the studios due to the fact that they are cheap. The article mentions the same with the RedBoxes. Both are far cheaper for the consumer than in-store rentals or on-demand from Cable/Satelite and they get the worst priority. It's as if the studios resent those customers for finding a great bargain and want to take out their anger on them. But again, if seeing that movie right away is that important, you can pay the premium to do so.

Just Say No to revenue

[Sloppy]

The studio is hoping that the four-week window will push consumers interested in watching movies at home to..

..check the torrent sites.

Re:28 days later

[DaveGod]

is anyone really that hell-bent on getting a movie that they'd rather pirate it than wait 28 days?

That's movie-studio thinking. And yeah, on the face of it, it does make sense - break the law, commit a morally wrong act for the sake of 28 days?

But that forgets what movies have become. Torrents being free is only half of it - the other half is service. Piracy is fiercely competitive on service: they are quire remarkable in getting whatever you want, however you want, as quickly as they possibly can. The studios have taken some steps towards competing: cinema releases are increasingly worldwide and DVD releases have a shorter delay. But they're not really close - it's like the big airlines trying to do the low-cost airline thing, they just don't have the mentality for it.

It's why some people pirate despite having their cinema card, a Netflix sub and shelves of store-bought movies. It's not that they aren't prepared to pay, it's just piracy is the better service. Sure, plenty of pirates are doing it just because it's free, but there's a big chunk of people with a range of different reasons. Each step the studios take towards competing with piracy is a chunk of people for whom paying becomes their better choice. Each step away from competing with piracy, like delaying Netflix for 28 days, a bunch of people turn on the torrents. Many will actually be annoyed about not being able to get what they want by paying for it.

I'm not trying to defend pirates, I've never illegally downloaded a movie in my life (though I'll not pretend to having never watched any). But there's what's right and there's what is. Quite basic market forces.

Re:28 days later

[BobMcD]

Why wouldn't this line of reasoning stand up in court if you were to be busted for downloading a movie? Really the way I see it is if its rent-able by netflix and I have an account in good standing I should be entitle to watch anything I could rent no matter the means of transfer.

Largely because you are creating a copy of a work protected against such behavior, you'd legally still be on the hook.

The laws aren't designed to limit your access to the material. Instead they intend to control the circumstances under which that work can be duplicated. Just because you have the means to access it does not mean you have permission to create a copy.

Why this is not going to work

[joeszilagyi]

It didn't work before, as mentioned elsewhere, with artificial scarcity in the VHS rental days. It won't work now either with the DVD days. Why?

NOTE: My wife and I have SEVEN full bookshelves of DVD & Blu-Ray. We're movie nuts. We love to watch them. We love to go back and watch ones we particularly like. If they're good, we'll buy multiple editions we want--I've bought two copies of Iron Man, two full sets of Lord of the Rings, and lord knows how many Star Wars. I'll rebuy the latter two on Blu-Ray when they come out. I like to think we're the model of good customers. I don't bit torrent films because unlike some I like the way it looks on the shelf. The same as I like the way my books look on the shelf. Screw E-readers and stacks of ripped discs.

We also consume Netflix and Comcast OnDemand ravenously, and sometimes the Amazon download rental service or the local actual DVD rental store. Why?

I don't want to buy EVERY film I see. Some I'm fine with only seeing the once. I don't know if I'll like it. We only go to 10-15 films a year maximum in theaters (probably a lot compared to most). It's one of our main hobbies. Do I buy every film I see in theater on disc? Of course not. Half of them I'll never want to see again because they're either not memorable, not important to me, or total shit. Do I buy films that I've rented? ABSOLUTELY! All of them? Absolutely not! I recently watched GI Joe on a flight. Then we downloaded it on Amazon on a lark. My wife loved it, and she hates that sort of film. Now I want to buy it on Blu-Ray--why? It's fun, and it's a fun film you can watch again and toss on with company over to show off the pretty HDTV and laugh about the heinous execution of our childhood memories of GI Joe. Most importantly, again:

It's rewatchable.

Put out consistently quality, engaging films. Aim for every film to be Oscar caliber in some way. That doesn't mean every film has to have an Avatar budget or 99% of the Royal Shakespeare Company in the speaking cast. Pay for a good script. It doesn't have to be a great film--see my GI Joe example above. It's not a great film, but visually? Amazing, and rewatchable for sheer fun with people over. Pay for a good director. Pay for good lighting, decent CGI, good cinematograpy. Make films people will ****WANT**** to see more than once. You many music CDs I've bought in my life for one track that, after I played that track several times, I never listened to that CD ever, ever again? The same thing. Your trailer may be ace--but the film shit. Don't make shit films, and I'll be more likely to buy them. I'm sure the same goes for everyone else too.

Most importantly, don't piss on your devoted customers that pay your salaries. Rentals drive sales. Quality films drive sales. Crap product to simply have a release will never drive sales.

You ever notice how each week we get 3-5 new major film releases? You ever notice how 3-4 of them are substandard to the others? I think they're put out as loss leaders. You put out shit like that, and then complain that people don't all buy your annual release catalog on DVD? What did you expect would happen?

You work at our pleasure. We don't watch your products at yours.

Re:28 days later

[EastCoastSurfer]

It's why some people pirate despite having their cinema card, a Netflix sub and shelves of store-bought movies. It's not that they aren't prepared to pay, it's just piracy is the better service. Sure, plenty of pirates are doing it just because it's free, but there's a big chunk of people with a range of different reasons. Each step the studios take towards competing with piracy is a chunk of people for whom paying becomes their better choice. Each step away from competing with piracy, like delaying Netflix for 28 days, a bunch of people turn on the torrents. Many will actually be annoyed about not being able to get what they want by paying for it.

Bingo. I wanted to watch Inglorious Bastards. So, I head off to Netflix and it's not on streaming and the DVD is on wait. Lets ignore for a moment that we live in time where we shouldn't need physical media AT ALL in order to rent something (or even buy for that matter). Next I go to the xbox movie section and I see IB. I think good, I can rent it here. Nope, it's only for purchase and it's only SD. I'm trying my hardest to give someone money to rent their content and they won't let me! At some point more and more people are going to say f' it and just go straight to TPB. The hassle of finding it to rent just isn't worth it when I can find and download it in minutes.

BTW, I think the music companies have started to learn this lesson, even if they were pulled along kicking and screaming. Look at Amazon and ITMS now. No DRM, Amazon has a great changing selection of $5 albums, and both make it easy to find whatever you are looking for and purchase for a fairly reasonable price. Why can't movies follow suit?

Re:Awesome job!

[ColdWetDog]

I'm getting closer..... Just rented Pineapple Express from Netflix. Pop it in the player and wonder of wonders, ten minutes of stupid shit Sony adverts. No way to get around them.

Pop it out of the player, pop it into the Mac, copy and rip the files to the hard drive, pick out the movie and copy it to a fresh DVD. Nice clean movie. Still a bit of a pain and getting closer to just downloading it from a torrent site.

Keep going Sony. Nice work. Alienate even more people. You do this enough and folks that shy away from torrent sites because of legal concerns or moral concerns will find that paying you less and less gets a better product. Amazing.

If it's good, then it will be good in 28 days

[Simonetta]

But "28 Days Later" wasn't that good.

    If there's a 'must-see' then we don't know about it until it's out of the first-run theaters. How else are you going to know that the film is good? People that go to first run movies, spend $10 each for tickets, $25 for babysitter, $5 for popcorn, and $4 for popcorn aren't going to tell you that the movie wasn't anything but good. And the second week people are always going to say the film is good to prove that they can wait for quality.

    No, you gotta wait until the movie reaches the second-run $3 theaters. If it isn't any good then it won't get to these theaters. The studio will blitz the opening night with deceptive ads for a turkey and then go straight to DVD.

    If it's a real 'must-see' then just watch the previews/trailers until you know the whole movie. Your average Hollywood movie can have its entire look/feel/plot experienced in a three minute preview (Spiderman III, Superman Ten, anyone?).

    Nah, If it's worth seeing, then it's worth waiting for the DVD. And if it's really good, then it will make it to the library shelf where it will be free for a week or more.

    And if it's great, then it's timeless quality. So why not wait a year or two to see it? What difference does it make? Now's the time to go to the library and check out for free all the excellent movies that you decided not to see because you didn't want to spend $10 on an independent or foreign film when it was in the theaters.

    Myself, I always save the best for last. Maybe this week I'll watch this movie called 'Star Wars' that I've been hearing people rave about for so long.