Ultraviolet, the new digital copy system embraced by most of Hollywood, has finally gotten around to being more than a digital copy service, and is selling movies without being tied to a DVD or Blu-ray purchase. Unfortunately, the first studio to latch onto the direct service has decided to charge top dollar prices to those who decide to take the plunge. Frost and Sullivan analyst Dan Rayburn explains:
Specifically, Rayburn wonders why Paramount is charging $22.99 for 2010 release The Fighter in high-definition ($16.99 in standard-definition) and $19.99 for Braveheart (in HD), which is 17 years old. Indeed, Roman Polanski’s 1974 Chinatown, starring Jack Nicholson and Faye Dunaway, is available in UV for $19.99 (HD) and $12.99 (SD). New release Paranormal Activity 3 is available for the same $22.99 (HD) and $16.99 (SD).“What studio executive thinks consumers are going to pay $22.99 to stream a movie when we can buy the DVD for $7 or rent it for less than $2?” Rayburn wrote. “The economics don’t make sense for how the studios price digital content and the fact they are keeping Netflix and others from even renting physical discs, only so they sell more DVDs, clearly shows where their true interest lies — and it’s not in digital.” By comparison, Amazon is charging $18.99 for Chinatown on Blu-ray Disc (which includes bonus features) and $19.19 for DVD. Braveheart on Blu-ray costs $9.99 and $7.50 on DVD. The Fighter Blu-ray/DVD/digital copy combo pack is listed at $17.49. Even the Paranormal Activity 3 Blu-ray/DVD combo pack (no digital copy) is one dollar less than Paramount’s disc-free UV price at $21.99
Clearly some adjustments to the formula are needed, perhaps starting with taking a median price for physical before setting the standard for digital. Likely the source of this pricing is a common theme in the mobile appspace. The people who purchase the most digital movies tend to be males making closer to six figures than not, and who travel a lot. They’re the same people dropping $30 for the Slingbox app (and judging by the sales it’s had, there’s a lot of them).
Given that the only phone or tablet that plays Amazon rentals is the Kindle Fire, Paramount is probably hoping for a quick buck from all the Apple-loving fat wallets roaming out there, and loathe to take less money than they think their movies are worth. Rayburn is right when he says that movie studios need to watch out before they get Napstered, but I think he’s also slightly too infatuated with digital-only features. The public has a serious issue in general with assigning value to intanglible things that cost more than $10 or so, and while digital is certain to kill physical rental dead, the idea that borrowing or selling the digital goods that form your permanent library requires permission of the studio is unpalatable to most. Personally, I don’t buy digital copies of movies, and the ones I rent I certainly am unwilling to shell out more than $3-4 for a new release. The hassle of downloading a gig+ per movie simply isn’t worth it.
Via: [Home Media Magazine]