Thursday, December 1, 2011

Sony Changing The Window On Digital Movies

Sometimes you have to just move on. While we like to hang on to old ways and old habits, change is inevitable. And when you finally give change a chance, positive things can happen. For Sony, it means no longer being rigid on the order in which a movie gets sold or rented. The DVD model is no longer the customer choice for purchase; the world is digital and so it means changing the order to move digital sales up in the pipeline.

Sony's first step in change is with it's release "Bad Teacher". By moving up digital purchases ahead of rentals and DVDs, they saw a marked increase in revenue. "More good news for Sony: It says demand for digital rentals didn’t seem to drop once they became available two weeks after digital sales started. And physical sales — still the most important source of income for the studio — don’t seem to have suffered, either." Sounds to me like a successful test and one that should be repeated with every movie release. How quickly Sony embraces this new strategy remains to be seen; for now, they seem to like to classify it as a test only.

With the rise of cloud based services from Apple and Amazon, the switch to digital will only progress more rapidly. As digital becomes the preferred distribution choice, DVD sales are destined to decrease faster. It is the inevitable results of change in consumer preference. The pace of this switch can be slowed with aggressive pricing discounts. Where once DVDs cost $20 or more, today they are in the $5 bin. And at that price they become a great stocking stuffer too.

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