JOCKEYING FOR POSITION

If  you read this blog with any regularity you know I believe content streaming is going to have a profound impact on both movie distribution and exhibition.  At the moment we are witnessing a slew of companies from Apple to Amazon, from Verizon to Viacom positioning for best advantage and vying for the biggest piece of the content streaming pie they can get.

Given that, and as most of "Mucho Gusto's" subscribers are cinema exhibitors, I think it is imperative that you are fully informed as to the goings-on regarding content streaming.  Netflix (a content streamer) and DreamWorks (a content provider) are in negotiation to have DWs films streamed by Netflix.  In and of itself this is no big deal but it does signal a break in the major studio alliance with traditional premium content distributors like HBO (owned by TimeWarner), and premium content could easily ratchet-up to first-run content.

For their part, the studios and TV networks are still trying to figure out what their business models will evolve into and how best to extract maximum revenue without jeopardizing their position. Anyone of the major studios could become takeover targets for Apple, Microsoft, or Google.  Another scenario is that a tech or telco gets frustrated with negotiating with the studios and opens a production studio of their own.

Who Clocks Most Mileage on Internet Super Highway ?

Yes, you guessed it - Netflix, which now captures almost 30% of peak downstream traffic in N. America and 22% of all streaming.  Fact is, the collective we, haven't even scratched the surface of content streaming. That is why we have seen the large ISPs placing caps on broadband usage.

A Bite of the Apple

Apple's movie streaming cloud service - currently dubbed "Replay" - is coming but like Netflix, Apple has to negotiate licensing agreements with the majors content providers.  Legacy content providers like HBO stand in Apple's (and other streamers, ie. Amazon) way, but the Apple's of the world have the numbers on their side.  They can stream content to the masses on a cadre of web-enabled devices and do it on a worldwide basis, which more or less would eliminate piracy if first-run movies were streamed. So, in the end, Hollywood may have to re-think the current distribution arrangement with cinemas, HBO, and other premium content distributors. The exclusive window of availability for cinemas will be under attack as content streaming presents a huge new market for the studios and networks.

Call it what you will but companies like Netflix and Apple are changing the way consumers access and view movies and other premium content.

Best and Happy Movie Going!
Jim Lavorato

Related Posts
" All You Can Eat Internet Buffet"  - 27 July 2011
" Weekly CineBUZZ Report"  - 17 July 2001
" Ten Years After" posted  - 10 July 2001
"Streaming Will Impact the Cinema!" - 7 July 2001