Amazon Exploring Movie Downloads

Discussion
Mar 10, 2006
George Anderson

By George Anderson


A report in The New York Times, says Amazon.com is in negotiations with Paramount Pictures, Universal Studios and Warner Brothers to offer a movie and television show download service that would allow consumers to burn their own DVDs.


If the deal is consummated, Amazon.com would put itself in direct competition with Apple’s iTunes. Jeff Bezos and company, as has been previously reported (see RetailWire
2/17/06, Amazon Looks to Take Bite out of Apple’s Music Biz
), are also working on a music download service as well as a proprietary Amazon.com MP3 player.


The studios are providing backing for a number of on-demand content services, but none offer the option of allowing consumers to burn their own DVDs.


Amazon may have an advantage, according to the Times, because of its ownership of imdb.com (Internet Movie Database). The web site contains extensive information on movies and is often found through online searches using Google and other services. According to comScore Media Metrix, imdb.com was the most-visited movie web site February 2005 and February 2006.


Moderator’s Comment: What do you see as the market potential for movie and television program download services and
how will that impact the current rental and sales market? What merchants/services do you think are best positioned to take advantage of downloads?

George Anderson – Moderator

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5 Comments on "Amazon Exploring Movie Downloads"


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Jeff Weitzman
Guest
Jeff Weitzman
14 years 11 months ago
I agree that digital delivery is going to transform all forms of content, but the timetable is a little less certain. Movie downloads, IMHO, are not quite ready for general Internet services. I am personally an atypical media consumer: I have a home network, I have massive amounts of home storage, including a network-attached storage device, and I have the skills to edit video, transcode it into various formats, send it around my network, burn it onto DVDs, and stream it to my television if I want. And yet, I’m not all that interested in a movie download service. Yet. Here’s why: Time: even with a relatively fast broadband connection, it takes quite a while to download even a TV episode, let alone a movie, at full resolution (believe me, I’ve done it). That takes it out of the impulse purchase realm; I can’t decide on a movie 10 minutes before I sit down to watch it. In most cases, I’m not going to be able to decide on a movie and then watch it… Read more »
Tom McGoldrick
Guest
Tom McGoldrick
14 years 11 months ago

How could this not be a winner? It has very low incremental costs for distribution, and proven appeal from the music industry. I would like the option of buying the movie or renting it for a certain number of days.

If I could rent movies with this technology, I would cancel my NetFlixs subscription tomorrow.

Kai Clarke
Guest
14 years 11 months ago
Can we say iTunes Amazon-style? The download business will only be good for Amazon, the movie business and the consumer. Amazon has a tremendous share of eyeballs on the Internet, with a massive customer database. This means the ability to drive interest at a lower cost per thousand when the theaters need to generate interest and top-line revenue dollars. This also gives Amazon the ability to maximize their online presence by offering yet another “product” through their electronic portal. We can look for a JV with Amazon and some of the DSL or Cable folks as well, since it would benefit both of these organizations in a virtual online partnership. Finally, the consumer will win as prices continue to drop, competition gets more aggressive, and they have a larger entertainment choice. Consumers may no longer have to wait in line at movie theaters, but will soon be able to see a newly released movie in the comfort of their own home. There will be no delayed release dates (as there are now with DVDs) and… Read more »
Don Delzell
Guest
Don Delzell
14 years 11 months ago
I have felt for some time now that the entertainment delivery industry is in the same sort of revolutionary change that the transportation industry was at the time of the automobile’s mass production introduction. Traditional suppliers of almost anything to do with entertainment delivery run a grave risk of emulating buggy whip manufacturers. Unfortunately, I don’t have a perfect crystal ball or I would invest the few pennies I have in the next Ford motor company. Seriously, digital delivery of entertainment on demand is NOT going to go away. And, most of the current formats do NOT provide the experience, ease, and need delivery that the consumer really values. But someone is going to get this right, and soon. Burn-at-home DVD’s? No. I don’t think that’s the mainstream delivery method. Yet. Maybe in a 5 years or 10 years. But right now, that’s a skill set that most consumers do not believe they have. Yes, a significant number of consumers can and will participate in it. But look it at this way: DVD’s are available… Read more »
Mark Lilien
Guest
14 years 11 months ago

The entertainment download market potential is huge. The winners will be retailers who can preserve their margins by keeping customer acquisition costs low. Neither Amazon nor Apple have bricks and mortar locations to help them acquire customers. The copyright owners will have the best leverage. Look at movie theater chain profits. They often pay so much for the films that their only profit is from the refreshments. Movie theaters show commercials because they can’t make money showing movies. If the download sites can sell enough advertising, that may help their profits.

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