Wal-Mart Stores has launched its own movie download service, Best Buy is said to be in talks to start one, and Blockbuster explored buying movie-download company Movielink earlier this year.
April 9, 2007 (Press Release) --
When movies shifted from videocassettes to DVD, retailers simply cleared the tapes off the shelves to make room for discs. That's not so easy now that movies appear poised to follow music onto the Internet.
The shift of music online has hurt stores such as Best Buy, Wal-Mart and Circuit City, and some retailers are looking to avoid a repeat with movies. Wal-Mart Stores has launched its own movie download service, Best Buy is said to be in talks to start one, and Blockbuster explored buying movie-download company Movielink earlier this year.
Music and DVDs are important to retailers because they've traditionally driven customers to stores. Each week's new releases give people a reason to come back. And for electronics retailers such as Best Buy and Circuit City, discs are often a cheap impulse sale, unlike a pricey computer or TV.
But the decline in the number of CDs sold has accelerated every year since 2003, and dropped 11.7 percent last year, according to NPD Group. The number of DVDs sold grew 5 percent last year, but that was down from a 9 percent increase during the previous year. Selling prices for both music and movies have declined. And NPD said DVD sales would have slid faster if not for the growth of TV programs offered on DVD.
Even if movie and music downloads don't drive shoppers into stores, they at least keep retailers like Best Buy in the movie and music business.
Wal-Mart is the furthest along after selling 3,000 movie downloads in its first month, February.
Blockbuster spokeswoman Karen Raskopf said the movie-rental chain intends to enter digital downloads by the end of this year, perhaps in partnership with another company.
Online movies have a long way to go before they're as easy to use as downloadable music. Even compressed movie files can be a hundred times larger than an individual song, and Wal-Mart says a full-length movie may take as long as an hour and a half to download even over a high-speed connection.
Tech-savvy listeners who load thousands of songs onto portable music players may feel less of a need to download many movies, especially if they're going to be watched on a TV anyway. And Apple's simple 99-cent-a-song pricing at its iTunes online store hasn't caught on in the movie world, where purchase prices vary widely and many movies aren't available at all. In many cases, movies bought online can't be burned to a DVD.
And it's not clear whether customers, once they've gone online to download a movie, will do it at the Web site of a bricks-and-mortar retailer.
Meanwhile, some online businesses already have tech-savvy customers. Netflix, the Los Gatos online-only service that ships DVDs through the mail, is rolling out a streaming-movie option. And, of course, there's Apple, which has begun selling movies at its iTunes store online.
Author: Joshua Freed
Source: http://www.mercurynews.com/
The shift of music online has hurt stores such as Best Buy, Wal-Mart and Circuit City, and some retailers are looking to avoid a repeat with movies. Wal-Mart Stores has launched its own movie download service, Best Buy is said to be in talks to start one, and Blockbuster explored buying movie-download company Movielink earlier this year.
Music and DVDs are important to retailers because they've traditionally driven customers to stores. Each week's new releases give people a reason to come back. And for electronics retailers such as Best Buy and Circuit City, discs are often a cheap impulse sale, unlike a pricey computer or TV.
But the decline in the number of CDs sold has accelerated every year since 2003, and dropped 11.7 percent last year, according to NPD Group. The number of DVDs sold grew 5 percent last year, but that was down from a 9 percent increase during the previous year. Selling prices for both music and movies have declined. And NPD said DVD sales would have slid faster if not for the growth of TV programs offered on DVD.
Even if movie and music downloads don't drive shoppers into stores, they at least keep retailers like Best Buy in the movie and music business.
Wal-Mart is the furthest along after selling 3,000 movie downloads in its first month, February.
Blockbuster spokeswoman Karen Raskopf said the movie-rental chain intends to enter digital downloads by the end of this year, perhaps in partnership with another company.
Online movies have a long way to go before they're as easy to use as downloadable music. Even compressed movie files can be a hundred times larger than an individual song, and Wal-Mart says a full-length movie may take as long as an hour and a half to download even over a high-speed connection.
Tech-savvy listeners who load thousands of songs onto portable music players may feel less of a need to download many movies, especially if they're going to be watched on a TV anyway. And Apple's simple 99-cent-a-song pricing at its iTunes online store hasn't caught on in the movie world, where purchase prices vary widely and many movies aren't available at all. In many cases, movies bought online can't be burned to a DVD.
And it's not clear whether customers, once they've gone online to download a movie, will do it at the Web site of a bricks-and-mortar retailer.
Meanwhile, some online businesses already have tech-savvy customers. Netflix, the Los Gatos online-only service that ships DVDs through the mail, is rolling out a streaming-movie option. And, of course, there's Apple, which has begun selling movies at its iTunes store online.
Author: Joshua Freed
Source: http://www.mercurynews.com/
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