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Originally Posted by Wendell R. Breland
I agree except I would never lump in SVOD with physical or digital sales and rentals revenue. I know DEG does this and IMO they do this to make that group look good.
Subscription VOD should be reported like all other subscription video. Linear pay TV is the one losing to SVOD as seen here. The real question is how profitable is SVOD. Hulu has always lost money (by design?), Netflix is now in debt for > 8 billion $ and obligated for > 16 or 17 billion $ and Amazon won't say because Prime includes shipping. |
I agree that SVOD, like any other type of rental, does not really belong in a "sales" category, but I would also be naive to deny its growth and I do believe it does impact sales, both physical and digital. It also impacts cable TV subscriptions.
SVOD offers really inexpensive access to a lot of content and that is clearly appealing. I do not know how many times I have heard someone say that they will just wait for a movie to come to Netflix instead of buying it- on disc or digital. They pay their their monthly fee and that is all they want to spend on movies or TV shows. Cheap, convenient, decent enough quality and their customers are happy.
The debt burdens you mention for Hulu and Netflix sound problematic, but no matter how that plays out I am confident that SVOD will remain a part of the home entertainment landscape.