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Old March 14 2013, 08:50 PM   #19
Temis the Vorta
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Re: The Netflix Thread

jayceee wrote: View Post
Wonder how soon dvds (and blurays) will also disappear from the market, whether retail or rental.
I still have a godawful number of titles in my DVD queue, not available on streaming. I suspect there just isn't interest or bandwidth for Netflix/Amazon to do the deals for all of them.

But the "long tail" library is still a significant draw for subscribers. Everyone has their niche interest, so it's worthwhile for Netflix to serve those interests as long as it takes them no extra trouble or expense. Amazon and Netflix are both investing a lot more effort into high profile stuff, either new or doing deals for top movies and TV series.

Amazingly Netflix's profit margins are much higher for DVDs vs streaming, counterintuitively since DVDs should be more expensive - pressing, mail and personnel - which just goes to show how expensive streaming rights are.

...each streaming subscriber is worth only $2.40 in profit each quarter to Netflix, compared to $17.32 for each DVD subscriber. The old business was very lucrative. The new business kind of sucks. The economics are very different. The DVD business had fixed costs, while Netflix is forced to negotiate streaming licenses on a case by case basis with each media company.
DVDs will dwindle, but extinction is not yet on the radar.
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