Wednesday, March 14, 2012

Can Wal-Mart and UltraViolet Save The DVD Industry

The movie industry has enjoyed  a long history of selling  first laser disks, then VHS tapes, and DVDs to consumers seeking to build a personal library of content to watch at a moments notice.  But the rise of on demand and streaming content has made the concept of ownership less necessary.  Add to that the space a video library takes up on bookcases and the idea of ownership on digital devices or in the cloud becomes far more convenient with much less clutter.  And as consumers, there is less of a need to buy a DVD player with the rise of digital access to video content.  

When my kids were younger, we made sure our car had a DVD  player with screens in the backseat to entertain during long trips.  Today, that system is unnecessary.  Instead, we have iPads and iPods to provide that personal entertainment platform.  And they can each watch what they want..  No DVD  required.

But like all of us, we tend to be reluctant to embrace change, preferring to hold onto it as long as possible till it is too decomposed to even recognize it any more.  Do stores even sell VHS tapes anymore?  So how much life is left in the DVD industry and is it time to quicken its death or prolong it through UltraViolet?

Companies like Netflix, Apple, and Amazon are moving forward on a digital only strategy.  But Wal-Mart is still staying the course and working together with UltraViolet to push a dvd/cloud partnership.  " Wal-Mart is launching a disk-to-digital service, aiming to drive adoption of Ultraviolet, and DVD purchases, rather than lower-margin rentals, and to prevent piracy."  As long as consumers are expected to buy a physical DVD, I don't expect it to succeed.  Why buy a disk only to immediately throw it away once the digital copy is accessed.

Can UltraViolet exist post DVD?  With the rise of multiple cloud services and digital being the platform of choice, the movie industry may best be served selling itself to other retailers unless it can come up with a compelling approach to make UltraViolet a better consumer choice.  For now, perhaps it deserves a better brand name.

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