As I write this The Weinstein Company's top rental on YouTube is Michael Moore's SICKO, with a whopping 151 views. In reading PaidContent's article on the TWC/YTube alliance, you can't help wonder if there IS any business to be had in online rentals. Is the online one-off transactional content-rental business completely non-existent? And if so why?
I think we are starting to move away from the impulse buy mentality. It just doesn't fit with the world we are living in. Even with the convenience of online rentals, there is not enough value in it. If we are going to offer films in a single transaction, we need to offer more than the film.
My netflix queue, or rather my family's queue, is almost 2500 strong, including the WatchInstantly. I know what I want. I know what it is on the queue. I also have at To Watch list at home that is close to 500 titles. I recognize that those that don't try to earn a living in the film biz may not have such a robust list, but who in their right mind would rent a film that might be mediocre, when for twice the rental amount they can have unlimited streaming for the month.
A world of surplus and access require a different business model from one of scarcity and control. Single transactions -- without a richer context -- are an old world model.
If we build a social world around that film, it may be enough to jump me from my already planned choices of viewing. If we build a ramp of consistent discovery to that film, it may divert me from what I already scheduled. If you offer me additional rewards for my viewing, I may opt in. But if you ask me to fork over my hard-earned cash, all you give me is a film, particularly if it is not guaranteed to be great, and you ask me to watch it all alone, I will go elsewhere. And evidently everyone else is too. Well, everyone other than those 151.
Addendum: The failure of TWC titles to gain traction on YouTube has caused much reflection. What other factors contributed to the dismal performance? Scilla Andreen blogged the other day that the fit between content and platform was off. What else?
Addendum 2/10/11: LA Times reported a few days ago that downloads in US are up 40% to $385M/yr.