Thursday, July 10, 2008

Margin Impact: Online Vs. DVD Distribution

Factoid: Video on demand “day and date” sales--when content is available on the same release day as the same content released on DVD--has gross profit margins of 60 to 70 percent. DVD sales sold on the same "day and date" window have margins of 20 to 30 percent."

Keep that in mind as more and more experimentation with highly-popular movie and TV programming occurs. Even though gross revenue might be lower for digital delivery, so are costs. And the margin for digital products beats physical delivery by a three to one ratio.

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