 SLDPremium
join:2002-04-17
San Francisco, CA | reply to SRFireside
Re: Well by the time it hits DVDs.... Are you kidding? NetFlix is the largest distributor of DVD rentals in the world. Of course they have a lot of clout to negotiate better product for their consumer.
As an example, Walmart managed to get a number of artists to re-record entire songs to qualify for their "standards". |
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| It doesn't work that way. Wal Mart has the clout because they sell the CDs at a massive volume. Netflix isn't selling anything at all. To the movie studios rentals are a weak revenue stream because they don't get nearly as much money as they do from DVD sales. Netflix and other rental places pay a lot more for a single movie disk, but that disk gets rented out many more times for it than the studios get selling the DVD.
A DVD for Netflix would cost them maybe $100 or a bit more compared to our $20 price. But that DVD would be rented out much, much more than the five times it would take for the studio to recoup their money. It's even worse with streaming where the studio gets a small cut per viewing (I hear 25 cents). To them when you watch a streamed movie they are losing out on that full DVD charge they could be getting.
I'm surprised Netflix is getting away with what they are considering how much resistance Red Box is getting. Then again the studios are still fighting to keep certain releases out of streaming. |
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SLDPremium
join:2002-04-17
San Francisco, CA | You do realize that DVD rentals FAR exceed sale in volume AND profit, don't you? |
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 ThalerPremium
join:2004-02-02
Los Angeles, CA
kudos:3 | For the rental company, or the entertainment producers? |
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said by SLD:You do realize that DVD rentals FAR exceed sale in volume AND profit, don't you? The studios don't see that sales and volume, and all they care about is their profits. Remember the studio only got that one time charge for that DVD. They don't get any per-rental licensing. Once Netflix pays that $100-$200 for that disk that's all the studio gets. One disk can be rented hundreds of times for a national chain like that. The studio sees each rental as a lost purchase, so for them they could have had (lets just estimate 100 of the rentals) $2000. That's 10-20 times less in sales on that one disk.
This is why you never hear studios renewing interest in a movie franchise that did poor in the box office because rentals for the movie went through the roof. You do, however, hear a lot about a movie getting renewed life thanks to disk sales. |
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 CheesePremium
join:2003-10-26
Naples, FL
kudos:1 | said by SRFireside:said by SLD:You do realize that DVD rentals FAR exceed sale in volume AND profit, don't you? You do, however, hear a lot about a movie getting renewed life thanks to disk sales. Huh? |
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| I think he meant TV shows like Futurama and Family Guy, both of which made comebacks due to DVD sales (and other factors too, but DVD sales were the biggest).
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-Jason Levine |
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| Also movies. Pitch Black didn't do good on the box office, however it got the go ahead to create the sequel, Chronicles of Riddick, based on surprisingly robust DVD sales on the former. Fight Club did poorly at the box office, but more than doubled it's theatrical revenue from DVD sales. You can still hear people say, "First rule of Fight club..." or a similar meme. Office Space made only $10 million in the box office, but went on to sell over six million DVDs. That gave Mike Judge the clout to do Idiocracy.
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