Thursday, June 15, 2006
Disney: VOD Starting to Impact Rental
Posted by Damion Chaplin in "CONTENT" @ 04:00 AM
"Increased video-on-demand offerings through cable companies and online are starting to cut into the video rental business, Walt Disney Co. senior VP and chief financial officer Tom Staggs told analysts at the Deutsche Bank Telecom and Media Conference Tuesday. “I think that physical rental will continue to occur, but so far, it looks to me like you’ve got a cannibalistic effect that, at the end of the day, I don’t think hurts the overall marketplace,” Staggs said. “It certainly hasn’t hurt overall revenues for us.” He said that because of its extensive library, the studio is insulated from declines in the rental market."
Interesting, although not exactly unexpected news. I know a couple of times I've ordered a movie on-demand instead of driving to the rental place, so for me at least this is certainly true. However, I decided not to do that anymore because of one thing: SD TV. Unfortunately, my cable company doesn't offer VOD in high-def, which makes watching a movie on-demand a less-than-satisfying experience. For Disney movies, though, I can definitely see the advantage to turning it on and parking the kids in front of. Why go to the video store when you can just tune to a channel and give them their choice? Kids don't care about high-def pictures, they just want to see Nemo. Disney is one of the only (if not THE only) studios that could announce they're never selling another physical DVD again and they'd still get massive revenues from parents via VOD or online sales. By the way, I think Fox's estimate of 'several hundred million' in HD sales in 2006 is rather optimistic, don't you?
Interesting, although not exactly unexpected news. I know a couple of times I've ordered a movie on-demand instead of driving to the rental place, so for me at least this is certainly true. However, I decided not to do that anymore because of one thing: SD TV. Unfortunately, my cable company doesn't offer VOD in high-def, which makes watching a movie on-demand a less-than-satisfying experience. For Disney movies, though, I can definitely see the advantage to turning it on and parking the kids in front of. Why go to the video store when you can just tune to a channel and give them their choice? Kids don't care about high-def pictures, they just want to see Nemo. Disney is one of the only (if not THE only) studios that could announce they're never selling another physical DVD again and they'd still get massive revenues from parents via VOD or online sales. By the way, I think Fox's estimate of 'several hundred million' in HD sales in 2006 is rather optimistic, don't you?
