Warner’s new digital movie scheme, UltraViolet, gets an article in the NY Times positioning it as a way for the studio to compete with rentals, especially Netflix.
This strikes me as misguided. People who simply want to see a film for a buck or two for the night are not the same audience as those who want to own a copy. Wait, let me revise that — from the studio’s perspective, buying a plastic disc isn’t ownership, it’s just a license. Which might explain why, later in the article, an analyst says, “It remains far, far easier for DVD-buying consumers to pirate a digital copy of their movie.” If I spend $25-40 dollars for a copy of one movie, shouldn’t I be able to rip a copy to my laptop or tablet? Why should I have to pay extra (as Disney’s now doing, adding $5 to the price for the package with digital copy) to be able to watch it on another device? Changing the attitude to expecting a digital copy to come with the physical disc, as Warner is doing, instead of seeing that viewing flexibility as “piracy”, is a positive change.
The same analyst goes on to call the sale of movies online “a complete failure to date”. Yet no one, at least in this article, considers price. I’m not paying $15 for a digital copy that becomes my responsibility to back up and has no behind-the-scenes extras. The physical disc is a superior product that I can often (with deals, coupons, or patience) get for the same price, or less.
Anyway, the goal is to combat rentals by giving customers “digital portability”. With UltraViolet, you can watch your movie anywhere you want. But not using whatever software you want, which is why customers are complaining. The setup can be complicated to get through, and people dislike having to change how they manage their digital movie “collection” just when they’ve gotten used to iTunes.
This is something of a scary quote:
“We must move consumers in mass numbers toward collecting movies digitally, and this is a path,” said Kevin Tsujihara, president of Warner Home Entertainment.
In other words, they aren’t buying our stuff, and we took them for granted, so now we think they have to do what we tell them to in order to keep our profits where we think they should be. I know entertainment company heads often feel entitled, but I haven’t often seen it expressed that boldly. It’s never the films themselves, is it, that’s responsible for sales? It couldn’t be that if you put out better movies, more people want to collect and re-watch them? Instead, they clearly see the market as at a transformative point (which, yes, is also true):
“We recognize that the product is not perfect today,” Mr. Tsujihara said. “We don’t have the luxury of waiting a year until we have everything perfect.”
Other fun facts: Warner Brothers has a 20% share of the home disc market. They spent $75 million to acquire Flixster, a key part of the UltraViolet streaming system, so customer dislike aside, I don’t think they’ll be going back to iTunes digital copies any time soon. Especially since Flixster lets the studio know what movies are in your collection, which is ideal for marketing. Plans for coming features are big, including selling films online and
a service called Disc to Digital that will allow people to pay a small fee per disc to convert their existing DVD collections into digital copies. The idea is to train consumers to manage their movie libraries online, much the way they do digital music or photos.
Managing my music on computer is not the same as managing it online (although once a movie is loaded into Flixster, you can access it even without an internet connection). I’ll be interested in seeing what the studio considers a “small” fee. With coming on a thousand DVDs (and I know more than 20% are Warner), anything over a dollar would be prohibitive. What would be very nice for customers, and perhaps drive UltraViolet adoption, would be “free”, based on inserting your DVDs and having them recognized by the system, especially the ones that came with digital copies previously.
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