In the movie content market, all revenue streams beyond theatrical showings basically are substitutional: money made in the DVD segment tends to displace revenue that might have been earned in the pay TV or broadcast TV segments, for example.
With the recent movement towards "day and date" release of movie content to DVD channels as well as video on demand, one should logically expect some revenue to shift from the DVD channel to the VOD channel.
But there's a difference in the "quality" of the revenue, from a studio standpoint. Studios make 60 to 70 percent profit margins on downloaded or streamed content; only 20 to 30 percent on DVDs.
Aggregate consumer spending might not change all that much, but studios might make more money. That is the only reason they'd even agree to a different "day and date" scheme.
Thursday, May 1, 2008
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