A recent report from IHS Screen Digest predicts that streaming will surpass DVDs and Blu-Rays as the top distribution system for movies. By the end of 2012, U.S. consumers will have watched 3.4 billion movies via streaming, compared to 2.4 billion views from physical media sources. In 2011, the numbers were 2.6 billion views from discs and only 1 billion views from online streaming.
Dan Cryan, senior analyst at IHS, said,
The switch is, I think, indicative of more than just a shift in delivery system. It also reflects (and contributes to) two more fundamental shifts in audience behaviors.
First, while content has always been king in terms of the value of media consumption, historically the content has been tied to the physical delivery system and that's been how consumers thought about it. They watched TV, listened to radio, read a book or magazine. With digital networks offering more distribution paths for media, people are increasingly separating the content from the medium, and recognizing that (almost) all of the value lies with the content. When that happens, consumers increasingly recognize that the value comes not from owning a copy, but from the ability to access the content. And subscription streaming services offer access to a lot more content.
Second, online delivery offers consumers more choice and flexibility in viewing options, and consumers are learning the value of that flexibility and having more choice. The shift here may be even more profound for media and content industries, as it is demonstrating that while content is king, that there are ways to add value to content, and that added-value aspects can drive consumption decisions in a highly competitive market. While this may initially be a threat to traditional media, the idea of considering how value can be added is also an opportunity for product differentiation that media can take advantage of.
Source - 'The end of movies on disc': Online 'streaming' films will outnumber DVDs and Blu-Rays combined for first time this year, Daily Mail Online
Dan Cryan, senior analyst at IHS, said,
"U.S. consumers now are making a historic switch to Internet-based consumption, setting the stage for a worldwide migration of consumption from physical to online... But the transition is likely to take time: almost nine years after the launch of the iTunes Store, CDs are still a vital part of the music business."The report attributed the rapid growth in the use of online movie delivery to subscription services like Netflix, Amazon Prime, and Hulu+. In fact, viewing movies from online subscription services accounted for 94% of all paid online movie consumption in the U.S.
The switch is, I think, indicative of more than just a shift in delivery system. It also reflects (and contributes to) two more fundamental shifts in audience behaviors.
First, while content has always been king in terms of the value of media consumption, historically the content has been tied to the physical delivery system and that's been how consumers thought about it. They watched TV, listened to radio, read a book or magazine. With digital networks offering more distribution paths for media, people are increasingly separating the content from the medium, and recognizing that (almost) all of the value lies with the content. When that happens, consumers increasingly recognize that the value comes not from owning a copy, but from the ability to access the content. And subscription streaming services offer access to a lot more content.
Second, online delivery offers consumers more choice and flexibility in viewing options, and consumers are learning the value of that flexibility and having more choice. The shift here may be even more profound for media and content industries, as it is demonstrating that while content is king, that there are ways to add value to content, and that added-value aspects can drive consumption decisions in a highly competitive market. While this may initially be a threat to traditional media, the idea of considering how value can be added is also an opportunity for product differentiation that media can take advantage of.
Source - 'The end of movies on disc': Online 'streaming' films will outnumber DVDs and Blu-Rays combined for first time this year, Daily Mail Online