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Warner & Netflix announce a way to throttle BD new releases


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#1 of 36 David Deeb

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Posted January 06 2010 - 07:22 AM



Warner & Netflix agree on a new Blu-ray rental model which holds back new Warner releases for 28 days.   They want to protect their BD sales.  

As much as I like Warner, I can understand this, but I don't like this move.  And I think it is counter productive.  

If it is a movie I'm crazy about, I'll buy it anyway.  If it's one I'm not crazy about, I'm not that stupid to go out and just buy it... I'll just wait to rent it or spend my money on new releases that ARE available. 

What does everyone else think?

http://www.hollywoodreporter.com/hr/content_display/news/e3i75b1b29eacd3861b1cc98d04441cf7b6





#2 of 36 cafink

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Posted January 06 2010 - 07:38 AM

I can understand how this would be annoying to some, but I'm not personally bothered by it very much.  If there's a movie I just have to see right away, I'll go out and see in while it's in theaters, of course.  If I can wait a few months for it to hit Blu-ray, a few more weeks won't matter to me.  I can't remember the last time I watched a new DVD or Blu-ray within a month of its release, anyway.

 

 


#3 of 36 ManW_TheUncool

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Posted January 06 2010 - 07:47 AM

Odd move (for Warner) indeed.  It sounds to me like it actually benefits NF more than anybody else since they'll save $$$ w/ this deal (and probably still won't pass the savings to their customers by removing the BD price premium they've been charging).

I hope Blockbuster doesn't follow suit, but they probably will for the $$$ savings as they could probably use that.  OTOH, if they don't follow suit, they would get the release date advantage over NF, which they may need even more than the $$$ savings in the long run.  I can imagine plenty of NF BD customers seriously considering switching to Blockbuster Online over this (on top of Blockbuster's lack of BD price premium).

Should be interesting to see how this plays out...

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#4 of 36 Southpaw

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Posted January 06 2010 - 08:34 AM

So the main benefit to NF is the lower cost in obtaining rental discs from WB? Is that it? So any add'l consumer sales WB might get out of holding back rentals for 4 weeks would be offset by receiving less from NF to sell rental discs?
Plus, you add in the fact that they are starting to withhold special features on rentals and I'm starting to see less and less benefit to having a NF subscription.

#5 of 36 dpippel

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Posted January 06 2010 - 11:08 AM

I'm very happy renting my Blu-ray titles from Blockbuster Online for the same price as a standard definition DVD without waiting a month after street date to get a disc. I sincerely hope that this backfires.
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#6 of 36 Brandon Conway

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Posted January 06 2010 - 11:33 AM

I'm willing to bet that if Blockbuster doesn't follow suit Warner might not allow them access to their films period.

"And now the reprimand, from an American critic. He reproaches me for using film as a sacred & lasting medium, like a painting or a book. He does not believe that filmmaking is an inferior art, but he believes, and quite rightly, that a reel goes quickly, that the public are looking above all for relaxation, that film is fragile and that it is pretentious to express the power of one's soul by such ephemeral and delicate means, that Charlie Chaplin's or Buster Keaton's first films can only be seen on very rare and badly spoiled prints. I add that the cinema is making daily progress and that eventually films that we consider marvelous today will soon be forgotten because of new dimensions & colour. This is true. But for 4 weeks this film [The Blood of a Poet] has been shown to audiences that have been so attentive, so eager & so warm, that I wonder after all there is not an anonymous public who are looking for more than relaxation in the cinema." - Jean Cocteau, 1932


#7 of 36 ManW_TheUncool

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Posted January 06 2010 - 11:34 AM

OTOH, didn't a lot of folks complain that it takes forever to get new BD releases from NF anyway?  Maybe waiting the extra 4 weeks so that NF can maybe buy more copies will end up working out more or less the same for many customers (and better for those who don't mind the planned delay).

_Man_

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#8 of 36 TravisR

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Posted January 06 2010 - 11:40 AM

Clearly, I'm not privy to WB's sales projections but I can't imagine this really boosting sales all that much. I don't think there's many titles that I would have only rented but will now buy because I can't possibly wait 4 weeks to see it. If I need to see it that badly, I was likely already buying it.

#9 of 36 Simon Howson

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Posted January 06 2010 - 11:56 AM



Quote:
Originally Posted by David Deeb 



Warner & Netflix agree on a new Blu-ray rental model which holds back new Warner releases for 28 days.   They want to protect their BD sales. 


Wow, and I thought they believed in competition in the U.S.



#10 of 36 ManW_TheUncool

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Posted January 06 2010 - 01:23 PM


Quote:
Originally Posted by Simon Howson ">

Wow, and I thought they believed in competition in the U.S.

 
Well, most of us do (I guess), but the top dogs in each industry aren't run by most of us.   Competition is for the also-ran's.  Bill Gates & Co. didn't dominate by encouraging more competition.  They did it by squashing them. <img alt=

_Man_

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#11 of 36 TonyD

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Posted January 06 2010 - 02:25 PM

I thought this was for dvd and blu-ray.

Also this is the same deal most stufios have with Redbox too.

I don't like it and it won't force me to buy anything.
Since I work at a BBV I get 5 free rentals a week and get all the new stuff before street to watch.
I also have a 4 out with Netflix and a 2 per month BBO free employee account, so this mostly won't effect me anyhow.

Still I don't like it but I'll look at it this way, A movie has a rental street date that is now 28 days later then it was before, oh well.

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#12 of 36 Southpaw

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Posted January 06 2010 - 02:25 PM



Quote:
Originally Posted by TravisR View Post

Clearly, I'm not privy to WB's sales projections but I can't imagine this really boosting sales all that much. I don't think there's many titles that I would have only rented but will now buy because I can't possibly wait 4 weeks to see it. If I need to see it that badly, I was likely already buying it.
Exactly.
And you know what boosts sales in my household? Lower street prices. The month of December saw me buy multiple titles I wouldn't have otherwise because I got them for $15.99 or $16.99 or in some cases $17.99. (The Hangover and Harry Potter are two of them WB!!!)  Those are price points I can live with. Not $25+




#13 of 36 Felix Martinez

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Posted January 07 2010 - 01:50 AM

I'm not sure how many viewers are like me, but if I wasn't going to buy the movie on street day or that week to begin with, this move would just delay any purchase I would otherwise make.  If I'm unfamiliar with a film, I want to check it out via rental and see if I fall in love with it first before buying.  At best, this would just push back my decision to buy at least 28 days.


#14 of 36 Edward Mann

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Posted January 07 2010 - 02:12 AM

Since it seems to take Netflix two to three months to send me a new release, I don't think I'll see much of a difference.  I'd prefer they get rid of the extra charge for BD's since it appears they don't spend it on more copies anyway.  They can delay all they want, there are very few movies I would ever buy sight unseen.  It seems the only party that will really benefit is Netflix with lower prices, unless they pass some of it to us. LOL


#15 of 36 Douglas Monce

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Posted January 07 2010 - 02:47 AM



Quote:
Originally Posted by Man-Fai Wong 

Odd move (for Warner) indeed.  It sounds to me like it actually benefits NF more than anybody else since they'll save $$$ w/ this deal (and probably still won't pass the savings to their customers by removing the BD price premium they've been charging).



_Man_
Actually the main benefit to Netflix is they are getting more films from Warner for their instant view service, which is the fastest growing part of their business. Also this applies to both blu-ray and DVDs.

finance.yahoo.com/news/Netflix-to-delay-delivery-of-apf-1311516316.html


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#16 of 36 Jon Martin

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Posted January 07 2010 - 02:47 AM



Quote:
Originally Posted by TonyD 

I thought this was for dvd and blu-ray.
 
It is for DVD too, not just Blu-Ray.

I think it might already be going on as I've had THE HANGOVER at the top of my queue since the day it was released and it has continued to be at Very Long Wait status.  I had returned several DVDs the day it was released and didn't get it.  So, they must have a very limited supply, if they are carrying it at all.



#17 of 36 Chuck Anstey

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Posted January 07 2010 - 08:20 AM

I think we consumers may shortly get hit with the pendulum swinging back really hard.  Anyone old enough to remember the days of rental pricing before studios made revenue sharing deals with BB?

So back in the day studios wanted more of the rental profit from movie rental places so they implemented rental pricing for 90-180 days of a movie's home video release.  Just before DVD came out there was movement in the revenue sharing between studios and movie rental places, specifically BB, so BB could have tons of copies and studios got a fair share of the rental money.  Out comes DVD but BB doesn't really want to rent them because not enough people have players.  Unexpectedly to the studios, consumers start purchasing DVDs in droves because there was finally a format that did not wear out or simply rot away and the sell-through price was reasonable, or so it seemed anyway.

Over time sell-through became more profitable than renting and enough people had DVD players so rental pricing was scrapped completely.  Now consumers are being more selective in their movie buying habits, possibly recognizing that they may not really need to buy every new movie at $15-$20 as they look over their collection of DVDs that haven't been watched in years.  I know that is how I feel and many here on HTF have expressed a change in their buying habits as well.  So here comes the pendulum back again and we are possibly starting to see the beginnings of rental pricing as sell-through profits fall further and renting becomes more profitable once again.


#18 of 36 Ernest

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Posted January 07 2010 - 08:29 AM

Many sites are reporting the new agreement is for both DVD and BluRay which seems to make sense if you are trying to drum up sales at the expense of renting.  The studios have always wanted a sell through market for DVD/BluRay.  I think Blockbuster and others will join Netflix because they favor downloading.  Downloading is cheaper than buying DVD/BluRay, maintaining the inventory and reduces mailing costs. 

#19 of 36 TonyD

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Posted January 07 2010 - 11:14 AM



Quote:
Originally Posted by Ernest 

Many sites are reporting the new agreement is for both DVD and BluRay which seems to make sense if you are trying to drum up sales at the expense of renting.  The studios have always wanted a sell through market for DVD/BluRay.  I think Blockbuster and others will join Netflix because they favor downloading.  Downloading is cheaper than buying DVD/BluRay, maintaining the inventory and reduces mailing costs. 
The article linked in the op says dvd and blu-ray, it was the op who incorrectly only mentioned blu-ray in the title and the post.


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#20 of 36 Jon Martin

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Posted January 07 2010 - 12:24 PM



Quote:
Originally Posted by Chuck Anstey 

I think we consumers may shortly get hit with the pendulum swinging back really hard.  Anyone old enough to remember the days of rental pricing before studios made revenue sharing deals with BB?

So back in the day studios wanted more of the rental profit from movie rental places so they implemented rental pricing for 90-180 days of a movie's home video release.  Just before DVD came out there was movement in the revenue sharing between studios and movie rental places, specifically BB, so BB could have tons of copies and studios got a fair share of the rental money.  Out comes DVD but BB doesn't really want to rent them because not enough people have players.  Unexpectedly to the studios, consumers start purchasing DVDs in droves because there was finally a format that did not wear out or simply rot away and the sell-through price was reasonable, or so it seemed anyway.

Over time sell-through became more profitable than renting and enough people had DVD players so rental pricing was scrapped completely.  Now consumers are being more selective in their movie buying habits, possibly recognizing that they may not really need to buy every new movie at $15-$20 as they look over their collection of DVDs that haven't been watched in years.  I know that is how I feel and many here on HTF have expressed a change in their buying habits as well.  So here comes the pendulum back again and we are possibly starting to see the beginnings of rental pricing as sell-through profits fall further and renting becomes more profitable once again.
I don't think it is quite that case, as it may just signal the end of the DVD rental market.

This isn't going to help the rental industry.  It is going to help the studios to sell more. 

And, rather than renting, people can just turn to Pay Per View.  Warner has a day and date deal with most titles (including THE HANGOVER) even when they aren't going to be available at Netflix.  

Face it, the DVD rental industry has been lucky to be able to stick around for the past decade.  People were so used to renting VHS that they stayed with the practice even though DVDs only cost a small percentage of what a VHS did.

Just like CD rental companies never started up, people are starting to wise up it doesn't pay to spend $4 to rent a DVD that, if you wait long enough, you can buy for that same price in the Wal Mart budget bin.  Netflix, with its flat rate, has developed a niche.  But with BB's almost extinct, and mom and pops getting more rare, I think Best Buy and Wal Mart, along with Warner, will have the most to gain from this deal.






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