Best Buy prepares for a "post DVD-era"

[GizmoDVD]

http://bits.blogs.nytimes.com/2009/1...-post-dvd-era/

Best Buy sells a lot of DVDs, but it is taking another step to get ready for the day when that business shifts online.

The giant electronics retailer on Tuesday is announcing a partnership with Sonic Solutions‘ Roxio CinemaNow service to deliver first-run DVDs streamed online directly to consumers.

The idea, said Chris Homeister, senior vice president for entertainment at Best Buy, is to let consumers pay once for a DVD and then eventually be able to play it on any device: television, Blu-ray disc player, personal computer, handheld media player or smartphone.

The new service will be a Best Buy-branded offering, available starting early next year. “We’re going into this business in a big way,” Mr. Homeister said. “Our goal is to have broad availability in the marketplace, across multiple devices.”

Last month, Best Buy announced a deal with Netflix to stream its movie library to Best Buy’s Insignia-branded Blu-ray disc players. And in September, Blockbuster announced it was working with Sonic to offer Blockbuster’s streaming movie service on consumer electronic devices starting with TiVo DVRs and Samsung high-definition televisions and Blu-ray players.

“All these guys — Best Buy, Blockbuster and Netflix — realize is that the era of the boxed DVD is about to end,” said Tim Bajarin, president of Creative Strategies, a technology consulting firm. “They all have to make the transition to the next generation of movie distribution, streaming directly to the consumer.”

Best Buy, analysts say, has the clout to press both movie studios and consumer electronics companies to adopt a one-time payment model and ensure that movies play on many devices. And the company has the ability to market such a service aggressively to consumers.

Sonic, based in Novato, Calif., is making a transition of its own. It is best known for its DVD-authoring software tools used by the studios. But Sonic has invested heavily in becoming a cloud-based service as the back end for the secure digital distribution of movies. “This whole industry is moving away from discs to electronic distribution directly to consumer devices,” said David Habiger, chief executive of Sonic.

Last year, Sonic acquired CinemaNow, an online movie distributor, from a group of investors including Cisco Systems and the movie studio Lionsgate. CinemaNow, founded in 1999, was endorsed by the Hollywood studios as an alternative to illegally downloaded movies over the Internet, but the service never became popular with consumers.

[GizmoDVD]

Some pretty strong words in there in regards to physical media. (Cue Kosty graphs showing just how much BD sells etc.)

[Sbert]

BD is semi protected for a few years since it represents HiDef and Hidef nonpackaged media delivery systems are not in place or fast enough to cater to demand at this time.

[ack_bak]

Originally Posted by GizmoDVD

Some pretty strong words in there in regards to physical media. (Cue Kosty graphs showing just how much BD sells etc.)

But look who is saying those big words. This is no different than some of the predictions from the BDA/DEG in recent years. It is called posturing and towing the company line.

[GizmoDVD]

Originally Posted by Sbert

BD is semi protected for a few years since it represents HiDef and Hidef nonpackaged media delivery systems are not in place or fast enough to cater to demand at this time.

There are many HD options available through streaming already present. Not only do you have NetFlix (which has some stuff in HD), but VuDu, Xbox 360, PS3 etc. It may not be BD quality but most consumers really won't care or even be able to tell.

[GizmoDVD]

Originally Posted by ack_bak

But look who is saying those big words. This is no different than some of the predictions from the BDA/DEG in recent years. It is called posturing and towing the company line.

Not saying I agree with it (nor do I think this plan will work), just posting it. Lots of articles get posted here when we can read right through to their agenda and they seem to get a pass as long as its pro Blu-ray.

[Sbert]

Originally Posted by GizmoDVD

There are many HD options available through streaming already present. Not only do you have NetFlix (which has some stuff in HD), but VuDu, Xbox 360, PS3 etc. It may not be BD quality but most consumers really won't care or even be able to tell.

Yes, I realize that. That is why I said semi protected. Because people in my area really don't have the bandwidth beyond 3-4 mbps which is right at the cusp for some of those streaming options. Might be able to partial download then stream, I guess.

The infrastructure is not in place for mass HD streaming. There is content providers, no doubt, but just because it's available doesn't mean it's accessible.

[ack_bak]

The problem is that people really are not flocking to downloads. Blu-Ray appears to be growing faster than downloads, and optical media (BD/DVD) completely dominates downloads/VOD:


Part of the problem is the inflexibility of the download models and this appears to be just another model. Is this new Best Buy model compatible with Disney's upcoming Keychest? What about iTunes, Xboxmarketplace, PSN, Vudu, Comcast, Dish, etc? This is one of the biggest issues I have with downloads/VOD. It is a completely fragmented market with lots of companies and studios all doing different things with little to no compatibility between models. Until the studios, content providers, and CE's all rally around at least one common platform and delivery mechanism, I believe downloads will remain very niche and many mainstream consumers will view it only as a rental medium.

[GizmoDVD]

Originally Posted by Sbert

Yes, I realize that. That is why I said semi protected. Because people in my area really don't have the bandwidth beyond 3-4 mbps which is right at the cusp for some of those streaming options. Might be able to partial download then stream, I guess.

The infrastructure is not in place for mass HD streaming. There is content providers, no doubt, but just because it's available doesn't mean it's accessible.

I really don't know what it looks like in other places, but where I am you can get very fast internet services. I know its not like that in other places, but maybe those are the type of people who are not into this type of stuff anyway and are still rockin' their VHS players. Those people will likely be left in the dust.

[GizmoDVD]

Originally Posted by ack_bak

The problem is that people really are not flocking to downloads. Blu-Ray appears to be growing faster than downloads, and optical media (BD/DVD) completely dominates downloads/VOD:


Part of the problem is the inflexibility of the download models and this appears to be just another model. Is this new Best Buy model compatible with Disney's upcoming Keychest? What about iTunes, Xboxmarketplace, PSN, Vudu, Comcast, Dish, etc? This is one of the biggest issues I have with downloads/VOD. It is a completely fragmented market with lots of companies and studios all doing different things with little to no compatibility between models. Until the studios, content providers, and CE's all rally around at least one common platform and delivery mechanism, I believe downloads will remain very niche and many mainstream consumers will view it only as a rental medium.

Unless I'm reading that wrong, Digital is twice the amount of Blu-ray sales (even with their higher pricetags for discs).

I fully agree there is no 'standard' like DVD and/or Blu-ray. Too many confusing factors that will leave consumers baffled. Until that gets fixed they will likely hover around small growth. Personally, I don't think people will 'buy' digital downloads but more or less 'rent' them so it really does not matter since they will likely watch it on whatever they rent it from (Xbox, VuDu etc.). I'll NEVER buy a digital movie. Ever. I believe both BD and VOD will co-exist (unlike some on both sides of the format war)

[zombieflanders]

Originally Posted by GizmoDVD

Not saying I agree with it (nor do I think this plan will work), just posting it. Lots of articles get posted here when we can read right through to their agenda and they seem to get a pass as long as its pro Blu-ray.

Riiiiiiight. Never mind that half the threads on the first couple pages of this forum are pro-download and/or anti-BD, started by anti-BD advocates, it's obviously only pro-BD articles getting a pass.

[zombieflanders]

Originally Posted by GizmoDVD

Unless I'm reading that wrong, Digital is twice the amount of Blu-ray sales (even with their higher pricetags for discs).

Right, but you're comparing one segment of physical media to an entire media unto itself.

[Grubert]

Originally Posted by GizmoDVD

Unless I'm reading that wrong, Digital is twice the amount of Blu-ray sales (even with their higher pricetags for discs).

Yeah- when combining purchases and rentals and digital downloads and digital streams and cable VOD and satellite VOD and standard definition and high definition.



Seems that tutti frutti flavored slice gets served a lot on this forum.

[GizmoDVD]

Originally Posted by Grubert

Yeah- when combining purchases and rentals and digital downloads and digital streams and cable VOD and satellite VOD and standard definition and high definition.



Seems that tutti frutti flavored slice gets served a lot on this forum.

Which is still a bigger piece of the pie as Blu-ray sales & rentals. Amazing. Time to throw out all that data guys because VOD encompasses too many things that makes Blu-ray look bad! Amazon and Wal-mart are literally giving away new releases now so hopefully that'll pick up numbers.

[Ray Von]

Originally Posted by GizmoDVD

Unless I'm reading that wrong, Digital is twice the amount of Blu-ray sales (even with their higher pricetags for discs).

That figure includes satellite and cable VOD though (plus rental, sales, SD, HD etc as already said above), and how long has that been around? Too long for anyone to be attributing too much to an 18% YOY growth figure.

The figures for actual internet streaming/downloads were somewhere between $140 million and $200 million, depending on who was reporting, IIRC.

Even if we only compare that to physical rentals and not sales, which is the fairest way to compare downloads since that's likely what most of them are, that still leaves them trailing. Split by SD/HD and downloads look even more anemic. And if the 18% growth for 'digital' is across the board, even moreso.

Ray Von