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Netflix is 'Killing' DVD Sales, Research Finds (torrentfreak.com)
Netflix has become the go-to destination for many movie and TV fans. The service is bringing in billions for copyright holders, but it also has a downside. New research shows that the availability of content on Netflix can severely hurt physical disc sales, which traditionally have been the industry's largest revenue source. From a report: A new study published by researchers from Hong Kong universities provides some empirical evidence on this issue. Through a natural experiment, they looked at the interplay between Netflix availability and DVD sales in the United States. The experiment took place when the Epix entertainment network, which distributes movies and TV-shows from major studios including Paramount and Lionsgate, left Netflix for Hulu in 2015. Since Hulu has a much smaller market share, these videos no longer reached a large part of the audience. At least not by default. The researchers used difference to examine the effect on DVD sales, while controlling for various other variables. The results, published in a paper this week, show that DVD sales increased significantly after the content was taken off Netflix, almost by a quarter. "Our difference-in-difference analyses show that the decline in the streaming availability of Epix's content leads to a 24.7% increase in their DVD sales in the three months after the event," the paper reads.
Video killed the radio star.
At least not at Walmart.
I don't see this as a downside at all, or even an upside for that matter. Should I care? I don't like to own dvds, I rarely watch the same movie multiple times. If I can rent and watch it, so much the better - less cost, less waste. Clearly, I'm not alone in this, given the figures. If dvd sales are replaced with streaming rentals, who is affected adversely? Apart from the handful of companies that produce the dvds and their packaging?
They no longer have to pay the cost of shipping physical media... As long as they can shift their revenue source over to the digital platform, who cares? The money saved on DVD's / shipping / labor more than make up for it.
It is bad because this type of research could lead to less availability of movies on streaming services. If the studios have hard proof that Netflix is costing them money, why would they allow their movies to be shown on Netflix? Either we would see far less movies available, or the prices would go up.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
DVDs are a dying business. The future is streaming. Who doesn't know that?
You can't sell someone a physical copy they can watch whenever they want while simultaneously getting them to pay you for it continuously. You can get one or the other. The studios wanted this "pay to play" system because all they saw was "Oh, wow, people will pay us for indefinite rentals! Infinite money! And we can do this for all the movies we don't sell too!" only to learn that the rate at which they will do so is far less than what they get on impulse and short-term need purchases. People will buy a physical copy because they get excited about a title momentarily; they don't watch it more than a few times and ultimately regret or just realize the purchase wasn't really necessary. Now that rush of excitement is spent by the first or second Netflix watch and they don't see the need to purchase the thing.
Then you are irrelevant as far as this topic goes. Why even bother to post?
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Why the hell do people want to own expensive cows and manage barn inventories when milk is cheap and fresh for $10 a month? Netflix is to DVD sales as internal combustion is to horse buggies. Research is limited to finding what research looks for.
I can't wait for this medium (and its high resolution counterpart) to die. Not only it is a fragile PoS - unlike what we were told initially, that you could scratch it with a screwdriver and it would keep working regardless - but, in addition, they tend to be shipped with unskippable junk that you have to watch every single time, before watching the material you are interested in.
but now they have some actual evidence of what the difference in disc revenue is. This could be useful (to either/both sides) next time Netflix needs to negotiate streaming contracts - Netflix can't claim "it won't affect your DVD sales" and the studios can't claim "without streaming we'd sell ten times as many, you have to pay us based on that".
It will be annoying and sad if this reduces streaming availability, but having it based on evidence seems like an overall win in the long run.
If the studios have hard proof that Netflix is costing them money, why would they allow their movies to be shown on Netflix?
The article doesn't say that Netflix is costing them money, just that they sold 25% more DVDs when they weren't available on Netflix. It's entirely possible that their streaming revenue would exceed the extra revenue from those DVD sales, but there aren't enough details there to say one way or the other.
Next thing you know they'll be saying that automobiles are killing off the buggy-whip market.
Just cruising through this digital world at 33 1/3 rpm...
We owned media in a time where the burden of re-acquiring it was too great. Now that I can rent just about anything from Amazon or iTunes from the comfort of my couch precludes the need for me to permanently store it on site. Very few of the films I still own are available on Netflix. I doubt Netflix is solely to blame, it is the ubiquity of media on all the various services many of us subscribe. And if we've learned anything from the music industry, the film industry should be cheering this since subscription services are outstripping the revenue once seen by the music industry from media sales alone.
Market clearing price to watch a movie – once, or 100 times by streaming – is lower than the cost to own it on Blu-Ray or DVD.
Studios may try to raise that price – temporarily – by not releasing the movie to Netflix streaming. But eventually they will, after disc sales fall off.
I'm in no hurry.
I have always thought of Netflix as a bone yard. Movies end up there once they aren't even worthy of the Walmart bargain bin anymore.
This decline in DVD sales and prices has been going on for a VERY long time already.
Blaming it on Netflix is a bit silly.
The idea of a DVD seems quaint to a lot of people these days. I wouldn't buy them myself if I couldn't convert them into nice DRM free files.
A Pirate and a Puritan look the same on a balance sheet.
The owning economy as opposed to the sharing/renting economy. And as past analysis have shown, the Netflix movie catalog is shit.
Even so, at one time you could at least rent a DVD from netflix of an "old" movie. No more. And nowhere else either, streaming or physical. In effect, a huge percentage of the movie catalogue is no longer available.
I like having what I want when I want it.
Forms of consumption other than privately owned physical media simply don't allow for this.
You're at the mercy of what corporations let you have at a given time and they can change their minds at any moment.
A Pirate and a Puritan look the same on a balance sheet.
That would depend on what's generating more money. What the studio's want is to have their cake and eat it too, in other words they want disc sales and streaming sales. Practically what that means is they will simply delay streaming availability until a certain number of months after the DVD/BluRay is available so as to capture both revenue streams. Several of the studio's already do this.
Which is why I convert my DVD's to ISO's and run them that way. DVD's are protected, and I can just run them from anywhere.
It's not every time they watch (at least with Netflix), it's every time they relicense. Netflix is smart and doesn't want to disincentivize itself from having people actually use the service, they want their customers to use it every free moment (it allows Netflix to charge more in the end).
Netflix wants to be able to be an all you can eat service, and that requires them not having per view fees.
There would be a return (for the producer) every time Netflix reups with something, but there's that with format changes too.
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
I buy DVD's and BlueRays. I like to own the "Right to Use" the content. I like not to have to rely on a given provider to have a contract to to stream content in order to be able to watch to something. I will watch some shows and movies multiple times. So for a certain core set up media I want to own the media. All that crufty back catalogue of movies and shows that is no longer available on streaming services, mine to see at any time of my choosing. I even ( GASP ) buy actual books from time to time, it seems as though there is SOME content not yet kindlified, that may in fact never be on those platforms. The streaming / sharing / caring economy will eventually strip you of any remaining un-curated choice in what you read, watch, or listen to. Seems as though there is some music not published the day before yesterday thats worth listening to. So yes I own many hundreds of CD's as well.
the vast majority of films don't need to be watched more than once.
Spoken by an Anonymous Coward who obviously doesn't have children. My six-year-old boy is on what must be his 863rd viewing of his Angry Birds movie DVD.
Couldn't it be the case that Blu-Ray and not Netflix is killing DVD sales? DVDs only have 480 line resolution vs. Blu-Ray's 1080. Why would people be buying DVDs anyway? You might as well hypothesize that Netflix is killing VHS sales of movies.
If I can be modded down for being a troll, can I be modded up for being an orc, or a balrog?
DVDs?
You mean like grandmas, truckers and sea captains use?
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
I get the hard copy, rip it to digital and then have it all hooked up to a media player so when the intertubes or the services goes down or the streaming service decided it doesn't want to pay for the rights anymore (Ehm Netflix and Babylon 5) I keep on watching and YES I watching things over and over and over.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
Can't beat the Netflix service perhaps, but around the same price as Blockbuster used to be for a new realese:
http://www.vudu.com/movies/#!c...
http://www.vudu.com/movies/#!c...
A touch more, but not much (I remember paying $3-5 for new releases, a 2-3 days), and the back catalog varies, but outside of deals is close (http://www.vudu.com/movies/#!content/4798/Vertigo $2-4 for 3-5 days back in time)
Here's UK rental prices over time, I seem to be in the ballpark. https://stephenfollows.com/the...
Sure, it's a one day rental now, but you don't need the extra time to return it, so that seems reasonable to me.
Definitely more expensive than Netflix by mail, but in the ballpark of rental stores I think
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
Seriously most of my 800 dvd's look perfectly fine on my 5" tv.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
Same here! I still buy physical media for the stuff I know I watch numerous times. Stuff disappears from the streaming services, but it's always on my shelves!
"A Bird In The Hand Will Poop On Your Wrist"-Benny Hill,1982
Which is why Netflix is going all out on original content. I currently watch more of Netflix's original content then I do their licensed shows so it seems to be working for them.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
Come to think of it DVDs are 20 (or more?) years old. In fact if you give someone a DVD, they look at you like you gave them a VHS. When they don't look at you weird, they never watch it because 1) they can't figure out how to play it on their computer, 2) they put it in a DVD player but cannot figure out how to switch the TV set to view the player (it's been years since they've done it), 3) they only watch streaming videos, 4) they ***only*** view videos on their phone, or 5) ain't got the time to watch the video (but lots of time to rant about it in the forums).
mfwright@batnet.com
We are a family of four - we have a few TVs in the house and none are capable of playing anything that looks like a shiny disc.
The streaming genie is out of the bottle and there is no way to put it back.
They're a bone yard for overpriced blockbuster content. They are a great source for cult classics and indie films. I've honestly found better movies because of Netflix than what I would have found on my own.
I still have a DVD subscription, but Netflix is putting most of that catalog on the chopping block too.
I'd mostly stopped buying DVDs before Netflix. For me the real culprit was too many alternatives. I'd watch PrimeTime TV, I'd watch recorded shows, primetime or otherwise, on my DVR, I'd watch YouTube, I'd not watch anything because I was futzing around online. By the time I got around to the DVD I'd bought, it was practically rotting with age.
Slow down, cowboy! It has been 4 hours since you last posted. You must wait another few hours.
studios want to gouge the public for $20+ in physical media sales first. After that they'll bring the price down to $14, $10 and eventually $5 varying by popularity of the content and format (DVD vs BD.)
This is the best part of being several years behind on watching movies. I have a near-endless supply of cheap movies. I watch them for cheap on Netflix, and if I like them I can get a physical copy for $5-8 (sometimes with a free streaming copy too).
I haven't bought a BluRay in about a year. It's not because the movies are on NetFlix, it's because most of the crap that's come out in the last few years isn't worth watching more than once, and hence isn't worth owning. The last BluRay I bought was The Princess Bride (which I already owned on DVD), because I watch it over and over again.
Sadly, the days when movies were compelling enough to keep watching over and over again seem to be gone. DVD and BluRay sales are dying as a result.
I agree with you for things that are important. Watching movies is not important to me.
love is just extroverted narcissism
Let's see, I can buy a physical copy of a movie, store it in my home, fetch it when I want to watch it and stick it in some player and play it. I still have to put it away afterwards, and have a place in my home to keep my movies. Even if I copied the physical disc to a home entertainment server so I don't have to fetch it every time, I still have to store it somewhere.
OR
I go to a website with my computer (or smart TV), click a few times and a movie plays. I don't have to store it, I don't have to rip it, I don't have to buy it. I get all the perks with none of the disadvantages (I can watch the movie whenever I want.)
Just going on the propensity for laziness of the human race, this is a no brainer. OF COURSE DVD and Bluray sales are going to suffer. Did they really need to do a study for this?
It used to be that movies in general got cheaper to buy with each year after they came out but I keep seeing ones on the shelf that are the same price as when they were new. Marvel has been particularly greedy, a copy of "The Avengers" should not be costing the same as "Captain American: Civil War".
I call bullshit on this. Price has nothing to do with it anymore. I dunno about you, but I don't even stop by the $5 bin of DVD's and Blurays in Walmart anymore. It has nothing to do with the price. Why should I buy it, take it home, find a place to put it, when I can just click on some stuff and watch it without all the hassle of the physical object?
Someday long before Netflix was even started (Blockbuster was still big), I realized I was spending $60 a week on DVDs which i would watch once and then go onto the shelves.
For a while, I would wait until they dropped to 5 bucks and buy them then.
I stopped buying that day and have bought 3 DVD's since (one of which- Inception- I thought I would watch a lot but actually I watched it twice).
Netflix didn't stop me from buying DVD's.
I really hate the pricing model for DVD's. As I get older, I rewatch and reread less and less content.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
Movies I want to watch more than once? I buy it.
Problem is there is only 2 movies in the past 2 years I wanted to buy. Most of the others I only wanted to watch once or did not even bother watching.
MAybe if Hollywood would make things that were not crap they would sell more? NAH, let's do a movie about a 1980's TV show instead.
Do not look at laser with remaining good eye.
I had this discussion with a friend of mine. They don't "pay per view", they license for a time period for a set amount.
Watch it once, watch it a thousand times does not matter., they are just paying the exorbitant fee.
_ _ _ Go for the eyes Boo! GO FOR THE EYES!
Show me the bargain bin impulse buy streaming license that replaces the $1.00 old western DVDs.
Where is the obscure horror movie lifetime streaming license from the same bargain bin?
Where is the private buying, selling, and trading of digital content licenses?
Where is the universal streaming license that works based on the content licensed, and not the content providers ecosystem?
Where are the movies and content that are worth more than a single watch to begin with?
This reads like more of the same "poor us, we're not the elite that we used to be" bullshit that comes out of the entertainment industry every couple of months. How does anybody even take this shit seriously anymore?
Seriously, when you base a pictures attraction on flashy visuals and established IP, why would anybody bother watching it twice?
The entertainment industry is continually shooting itself in the face, and complaining about the damage like its the consumers fault.
Remember when VHS rental was happening in every grocery store and strip mall in America? How did they studios even survive?
You are being ripped off every second of every day, so that advertisers can help rip you off even more tomorrow.
DVDs were out of my budget when studios decided I would be forced to watch several minutes of crap I couldn't skip.
This. AC got it right on the nose here. Blurays are even worse with the unskipable ads.
Really?
Many years ago there was a break down on anime DVD sales and the fact it was pointless to buy them when they were hitting cartoon network the day/month the disk hit the street.
The whole story showed the math on how they rights holders made WAY more money selling rights to CN than they did selling DVDs due to the small foot print of anime fans who buy disks rather than pirate.
I'm sure the same math has been done and so now each season of Archer will hit Netflix on the day/week the Blu Ray hits the street.
Or consider all the studios who have their stuff out all over for streaming 2 weeks before optical disks hit the front porches of consumers.
What are the odds that "no impulse control, gimme gimme gimme NOW!" is more responsible for the DVD hit than Netflix is?
So this story is dishonestly trying to convince you of the studios again going through woe and misery due to Netflix, when odds are DVD sales are down and profits are WAY up.
As usual, Hollywood is never at fault and it is someone else's fault...
I'm not a subscriber to Netflix and had been buying DVDs (no BR) the last twelve years.
My buying habit slowed WAY down not because of competing services, but because Hollywood intentionally limited the selection of movies to release on DVDs. I'm not a fan of recent releases and prefer buying older movies. But there are a LOT of good movies that are not getting released on DVD, and the older releases are harder to find. Screw the DVD releases of TV shows. In the twelve years I have been buying DVDs it was not missed that the selection of legacy titles on the store shelves has remained stagnant; I found myself returning to store less frequently because I had found no more titles than what I have already seen before. I'd like to buy more, but there is nothing there.
And this is the fault of Netflix HOW?
Eternity: will that be smoking, or non-smoking? I Corinthians 6:9-10
Sure, but of all the movies you've watched, in any format, in the past 3 years, how many do your kids watch continuously like that? Streaming is fine for that vast majority that only need to be watched once. DVD (or ripped copy thereof) for the rest.
Socialism: a lie told by totalitarians and believed by fools.
Can we say, "DUH!!!!! That's the point!" ???
I like having what I want when I want it. Forms of consumption other than privately owned physical media simply don't allow for this.
Well, good for you. Knock yourself out buying discs. Apparently you're in a shrinking class of people but there it is.
Personally I don't find it surprising at all that many people are finding the convenience of streaming a movie worth more than the quality and security they get from owning a disc. This is exactly what happened to music. I used to buy all my CDs and now am a total streaming convert. The only question I have is whether streaming services will balkanize, so any one movie/show is only available on exactly one service. I am not willing to pay $10/month to Netflix, another $10 to Amazon, another $10 to Paramount, and so forth. But all I can do it vote with my dollars and streaming behavior.
For those of us who like things "the old fashioned way", we have few brick and mortar stores left that carry DVDs, and many of those have killed their selection.
Local Best Buys, once several rows and giant displays in size, have all been shrinking these. In more than one such store, it's now one half-row, and mostly only near brand new stuff. We have to go further and further to find a decent store with some selection.
What's funny about all this is, MANY people I talk to complain, "There's no place to go to get DVDs anymore". Yet the stores seem to have decided for us that there's no market for them...
DVDs are a dying business. The future is streaming. Who doesn't know that?
People in areas with shitty broadband?
Delaying the streaming availability after the DVD has already been released may result in more piracy. A lot of people don't want to buy overpriced, new release DVDs.
While I don't like hollywood I doubt they'd be so incompetent as to not know the effect of Netflix on their sales by this point. They have many years of data to build models on.
Parenting advice from an anonymous Slashdot neckbeard with no children. I'm sure he'll jump at the opportunity to do just what you say.
Yes and no.
Some areas don't have decent internet and streaming video isn't practical (or possible).
Even so, at one time you could at least rent a DVD from netflix of an "old" movie. No more.
What? Since when? I rent old movies from Netflix on DVD all the time.
http://dvd.netflix.com/
I do miss being able to buy their surplus discs though. They discontinued that program about 10 years ago.
Vinyl sales are up, then recently it was discovered that tape cassette are coming back, so next move will be the return of VHS (or maybe Betamax ?!?).
I would imagine that the number of posts to an article may be used as some sort of performance benchmark for the editors, so posting "why is this on slashdot" is actually helping the editors, rather say nothing and move along. After a while they will shift to topics that DO get a lot of posts and hopefully it won't involve Trump.
There are three kinds of falsehood: the first is a 'fib,' the second is a downright lie, and the third is statistics.
I think the Amazon one is just a case of a poor format on the automated email. The question looks like it's going to you personally. People want to be helpful, or at least polite.
About 300, including Blu-rays and HD-DVDs. Also I have Netflix and Amazon Prime. My gf has a little over 1000, but there are a few duplicates in our collections.
I like movies.
I think a very significant accomplice in this 'crime' is the film industry, who very rarely produce anything that you would want to watch twice, really. Maybe I'm just too critical, but I can't really think of anything out of Hollywood that I cared to watch more than once - well, maybe there are a couple from long ago, but what I nearly always find lacking is something that is a bit original and feels convincing; regrettably, what you mostly get is a rehash of the same, old plot with a bit more in the way of spectacular (but strangely unconvincing) effects. That being the case, why would you actually want to have a stack of DVDs cluttering some shelf? Netflix and similar are perfect for this: you watch a film once and forget about it; incidentally, cinema is well suited for this as well, plus you don't need to have a spectacular home-cinema taking up space. This is probably why cinemas haven't disappeared, and why they may be seeing a bit of a renaissance atm.
LOL!
The fact that you think you "OWN" your DVD is hilarious. Read your "LICENCING AGREEMENT"...
This has always been a problem with an industry that want's it's cake and eat it too. Also why so few people are going to be crying tears to hear that another Company is horning in on their profits.
The real argument is that at least it is a static licencing agreement that you "own"... The irritating part about Netflix et al is the fact that certain points in time licencing agreements get changed (due to a variety of reasons all of which involve money and profit, but typically cost of licence, and regional locking and exclusive deals), and the movie/TV you enjoyed watching could just vanish without notice. I know I was halfway though a TV series once only to have the licence not renewed (for whatever reason), and then no longer able to have access to that content anymore... Whereas if you owned the DVD you would (at least until your media dies or gets lost).
My latest laptops all have no DVD drive, I think this is what is killing DVD sales.
And: every DVD I ever put into one of my laptops needed 5 minutes or more to start the movy or main menu due to "anti piracy *advertisements*'
In other words: I rather watch a pirated DVD than a real one. Not to mention that one of the DVDs I bougth was for no apparent reason a blue ray, I missed that fact and had to gift it away as my laptop at that time could read DVDs but not blue rays ... so bottom line I guess I bought 3 "DVDs" ... one 1978 martial arts movie, one 2012 martial arts movie which I had seen on youtube before and I realized later, oops it is a blue ray, and another movie where I forgot what it was :D
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
People don't want to own $20 plastic discs anymore
Take a look at the catalogue of things you can rent on dvd. Its not the netflix of say, 2005, where the dvd library was quite large and it was easy to get both newer releases as well as old stuff - meaning anything from say 5 to 10 years prior to the 1930s. Now the list is pretty much confined to 5 years or so, mostly direct to dvd and tv shows.