Netflix CFO doesn't anticipate Blu-ray to greatly impact sales

by Darren Murph, posted Sep 16th 2008 at 10:02PM

We've already heard Netflix CEO Reed Hastings say that the firm's DVD business was still good for the next decade, but CFO Barry McCarthy clarified its position on the sector by touching on Blu-ray adoption and online streaming. When asked about the significance of BD on its business, the exec casually replied that he "didn't anticipate a big impact," noting that thus far "consumer adoption has been slow." His sentiments match pretty well with sales figures, and until player prices dip into the sub-$200 realm, we don't see the situation changing much. Regarding online streaming, he asserted that its service would "outpace competing services such as Amazon.com's video-on-demand offering despite a smaller inventory of titles," and in fact, it would be used as a key ingredient for hooking new subscribers. Read the whole spill in the link below.

[Image courtesy of P2P-Weblog]

Filed under: Industry, Blu-ray, Other formats

Tags: adoption, blu-ray, blu-ray adoption, Blu-rayAdoption, business, ceo, consumer, digital downloads, DigitalDownloads, dvd, hd rentals, HdRentals, industry, netflix, rentals, sales

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Reader Comments (Page 1 of 1)

Neutral

EatingPie @ Sep 16th 2008 11:34PM

Not sure what impact it would have either way. They provide BD rentals, so if people want them, they have them. BD tanks, Netflix has DVD. BD takes off, Netflix has BDs.

Next year will be the year that BD starts to *really* take off. The BDA has stated that expectation, and they'll be making marketing pushes for high-profile releases, and low priced players in 2009.

It's also important to remember that Blu-ray adoption is FASTER than DVD adoption was, and there's no doubt about DVD's success.

-Pie

Neutral

andyg8180 @ Sep 17th 2008 9:17AM

Not sure if you know this... But Sony said "this is the year of the PS3" 3 years in a row... This is year 2 where BDA said "this is the year of the Blu"

I'm still waiting for cheaper movies... $20 movies would be fine, but not $35-$40 for Willy Wonka and the Chocolate Factory... wait, i like that movie...

Neutral

EatingPie @ Sep 17th 2008 1:09PM

Hopefully this one won't double post! :-)

@andy8180: You'd have to provide something to back that BDA claim up. They stated that 2009 is when they expect to see BD truly take off. I never heard any statements about 2008 -- unless it was just after winning the format war, and the were overcome with sensationalistic bravado. They said early in the year (February or March) that 2009 is when pricing will increase market "penetration" significantly (or however marketing people say such things).

Now, Sony can say every year is the year of the PS3 if they want. They, however, are NOT the BDA. The list of BDA members is absolutely huge.

-Pie

Highly Ranked

mitchelljd @ Sep 17th 2008 1:40AM

I love blu-ray, but...

Prices on players need to drop to $200 and below for basic models
Prices on movie and other content need to be at about the same prices or just minimal premium for BD version, times for studios charging $40 for a movie on BD is ridiculous, also to charge that $40 for movies which are avail for $12 on DVD as back catalog is even more insane.

Customers need a good priced HD option, NOT to be gouged. hence, slower adoption and people could try Digital Downloads instead

Neutral

zik @ Sep 17th 2008 10:19AM

Studios already have a moneymaker in DVD's. What's the point in investing in new technology (Bluray) if they can't charge a premium for it? Take away the premium and what really is the incentive for the studios at this time?

Neutral

wreckedchevy @ Sep 17th 2008 10:46AM

the incentive for the studios should be getting to double dip there in entire back catalog on blu but instead they are price gouging everybody on movies that have been out for years

Neutral

Jason @ Oct 28th 2008 4:56PM

The incentive for studios is to not be out done by other studios. If only Paramount and Sony were releasing movie in HD then more of the writers, actors, directors and producers would gravitate to those studios. This would result in the studios not adopting new technology to be left behind.

Consumers eventually would too, although the only studio worthy of any loyalty/favoritism right now would be Pixar.

Neutral

Nathan @ Sep 17th 2008 2:13AM

Still waiting on Mac compatible online streaming from netflix. They say they need mac based rock solid DRM. Yet, I can watch a lot of movies on my mac on Hulu last I checked.

Neutral

HeHaw @ Sep 17th 2008 12:53PM

Blu-ray for me baby. I've seen streaming and so far it's way behind blu-ray. Until they can meet or surpass the quality while not taking a week to download, no thanks. Even my girl thinks blu-ray is the way.

Neutral

Galley @ Sep 17th 2008 1:08PM

I'm still waiting for Apple to release a Blu-ray SuperDrive I can hook up to my 24" iMac. OS X 10.5.6 is rumored to include BD movie playback support.

Neutral

EatingPie @ Sep 17th 2008 1:28PM

I'm having wonky posting problems, but here goes another shot...

"the incentive for the studios should be getting to double dip there in entire back catalog on blu but instead they are price gouging everybody on movies that have been out for years"

Check the charts. The biggest sellers are all new releases. The Transformers sold a lot too, but the BD early adopters *waited* on that instead of buying the HD-DVD. And if you check Amazon prices, you will see that Blu-ray is only a few dollars more than new-release DVDs. Feel free to call places like Best Buy -- who charge MSRP -- "price gouging" but then it's your fault for not shopping around and saving $15.00 on a disk!

"Studios already have a moneymaker in DVD's. What's the point in investing in new technology (Bluray) if they can't charge a premium for it? Take away the premium and what really is the incentive for the studios at this time?"

Double-dipping is one way studios make money. How many versions of Princess Bride or X-Men are there? The biggest incentive is that DVD sales have slowed, and are continueing on a downward trend. And HDTV owners can see the difference between HD and DVD in the real world... after all, it's about 6x the number of pixels! So they will WANT Blu-ray, and in fact they already do. Blu-ray hold around 10% of the market of DVD on any given week, and this is VERY early in its lifespan.

So what incentive is there? Consumers want Blu-ray, and are foregoing DVD for it. Therefore if studios want to sell their movies, they need to make Blu-rays.

-Pie

Neutral

Loban @ Sep 17th 2008 1:31PM

So Netflix thinks we'll still be watching DVDs in 10 years!!! That seems a little wrong to me. I can barely stand to watch them now.

Highly Ranked

Dr. Kenneth Noisewater @ Sep 18th 2008 9:37AM

Well.. You may still be able to get Willy Wonka for like $9 on HDDVD.. I have been LOVING the closeout specials.. Children of Men, Eastern Promises, Elizabeth: The Golden Age, all like $10, along with Trading Places, Animal House, Coming to America for like $7 or $8..

.... While they last, of course!

Neutral

c64 @ Sep 29th 2008 2:54PM

i don't think its a big enough jump in picture quality for the average person.it really only appeals to the true videophile.

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