Last month, beleaguered video rental chain Blockbuster filed for bankruptcy. While the company's demise can be blamed on a number of factors, it's hard to ignore one: the rise of Netflix.
Netflix, which is now an $8bn corporation trading at just over $153 per share, looks poised to capture a big part of the nascent streaming business.
Once-dominant video rental chain Blockbuster is trying its hardest to
prove that it can compete in the 21st century. It is closing down
stores, and has been bulking up its on-demand offering.
But it looks like it may be too little, too late. Last Thursday, the New
York Stock Exchange announced that the company would be delisted from
the exchange after the company failed to win shareholder approval for a measure that would boost the company's stock price above $1, the
exchange's minimum. More often than not, a company's delisting is signal of impending demise.
If there was any doubt among media buyers about putting money into online video advertising, 2010 should be the year to change that. Consumers are increasingly turning to the digital space to watch video. Moreover, the influx of professionally produced content is making the digital space more friendly to large advertisers.
As with most any medium, if the eyeballs are there, advertisers will follow. Now it's just up to the medium to deliver on the predictions coming in for the next year.
It's 2010, and HBO is getting with the digital revolution. This week the cable network started streaming its content online. With a tagline of “It’s HBO on your computer,” all of the network's series and films will now be available for streaming — to existing subscribers — at HBOGO.com.
HBO's premium content is the reason that more than a few consumers spring for cable. But the network isn't ready to bring their films and series directly to the public. They can always do that later, but it may be too late by then to make up the strides that Netflix has been making in online streaming.
Movie studios think cheap DVD rentals are a major factor in DVD sales that have been on the decline for some time. And now one of those studios, Warner Bros., may have the ability to prove the theory right or wrong.
That's because rental giant Netflix has inked a deal with Warner Bros. under which Netflix won't rent new Warner Bros. releases until they've been on sale for 28 days.
It looks like Netflix might be spending more than $1 million on a recent campaign to improve its recommendation engine. The movie rental company recently held a contest that successfully improve its recommendation by more than 10%. But now an in-the-closet lesbian woman is suing the company for privacy invasion, saying that she could have been outed due to Netflix sharing data that wasn't quite so anonymous.
While her claims may be spurious, this could have legal implications for the ways user information is shared and stored online.
Imagine for a moment that you're the CEO of Netflix. The movie studios don't really like you. They think low-cost rental services like Netflix are cutting into DVD sales, which have declined. So they come up with a plan to block rentals of new releases for a short time, perhaps a month.
The question: do you oppose this plan or do you look to negotiate with the studios for some sort of benefit?
With ad pages in freefall, magazines shedding titles, and the future of magazines in flux, things are looking more than gloomy for the ad industry lately. And the same fate is likely to befall the dvd industry, according to Netflix CEO Reed Hastings.
Speaking at Magazine Publishers of America’s Innovation Summit, Hastings noted that his business is on track to suffer the same fate that magazines are enduring now. Is there anything to be done about it?
YouTube's quest for professionally created content is about to get interesting. The Wall Street Journal reports that the video giant is in talks with movie studios to stream movies to its users for a fee.
That will bring a shift from its free video supported by advertising model, but could go a long way toward helping the site turn a profit for Google — and possibly change the game for online film viewing.
Film studios are working pretty hard to make sure that new online rental services don't steal all their profits. But outside of movie theaters, they aren't entirely in control of the distribution of their content. And if the studios aren't careful, in the process of negotiating revenue deals, they might further choke off their own revenue streams.
This week, Warner Bros., Universal Pictures and 20th Century Fox announced they would withhold new releases from RedBox for 28 days or more after videos go on sale. In addition to delayed access to the video kiosk service, Warner is now seeking new deals with Netflix and will impose the same restrictions on the online rental site unless they give the studio "a day-and-date revenue-sharing option."
Warner is trying to tap into Netflix's increasing revenue potential. If Netflix gives in to Warner's demands, other studios will follow suit. And if the studios are too greedy in their demands, they might lose out on even more money.