PSound
09-25-09, 03:52 PM
Netflix: Xbox streamers were 'disengaged from physical media'
Just as the PlayStation 2 was crucial to launching the DVD business, the latest generation of videogame consoles, led by the Xbox 360, are playing a pivotal role in the fledgling digital movie business.
The reason is simple: Xbox 360 is in an estimated 16 million U.S. homes, the PlayStation 3 is in 8 million, the Wii is in another 20 million or so, making gaming consoles the leading Internet-connected device already hooked up to TVs.
They’re expected to hold that lead until 2013 when connected HDTVs overtake them, according to Futuresource Consulting.
Studios say that both Xbox and the PlayStation are a key driver of digital movie and TV episode sales after Apple iTunes.
Xbox, which has offered movie rentals and TV show sales through the Xbox Live Marketplace since late 2006 and streamed Netflix Watch Now since last year, has a 31% share of the digital video-on-demand business, second only to Apple’s 52% share, according to Screen Digest. That’s all the more notable given that Xbox doesn’t yet have content deals with all the major studios. (20th Century Fox and Sony are the two holdouts.)
So far, Netflix is the only third-party video service available on any game console in the U.S. The company has an exclusive deal with Xbox 360, but for how long, neither side has disclosed.
Netflix chief financial officer Barry McCarthy told an investors conference in early September that game consoles are the “principle” device for Internet movie services to be on because of the large install base. “In a perfect world,” he said, “we would like to be on the Wii and the PS3 also.”
Both Xbox and PlayStation execs say they are open to adding other third-party services to their consoles, though both seem intent on creating a more curated experience for users rather than adding the broadest array of digital movie stores to their devices, as manufacturers of Blu-ray Disc player and HDTV have done.
“It’s not just about plugging partners in,” Xbox Live general manager Christina DeRosa said of the company’s strategy. “It’s about picking the best and developing the best service around it.”
Lempel said PlayStation would consider adding services that add convenience and are easy to use.
“We don’t want to have a lot of services competing on the PlayStation Network, but if it really brings a good experience to the user and expands our content offering, certainly we’d look at it,” he said.
For studios, game consoles offer another advantage over other living room devices: access to the hard-to-reach and harder-to-market-to core male 28-year-old videogamer demo.
“I don’t think a lot of our audience sits down at 8 p.m. to watch a TV show,” said Lempel. But they are watching on demand. South Park and Family Guy episodes tend to be top sellers on both consoles.
Netflix chief content officer Ted Sarandos said that some of the customers Netflix has signed up from its Xbox partnership weren’t watching movies on DVD before and don’t order DVDs through the service, though they are streaming movies from Netflix.
“They were disengaged from physical media,” he said.
http://www.videobusiness.com/article/CA6698916.html
Just as the PlayStation 2 was crucial to launching the DVD business, the latest generation of videogame consoles, led by the Xbox 360, are playing a pivotal role in the fledgling digital movie business.
The reason is simple: Xbox 360 is in an estimated 16 million U.S. homes, the PlayStation 3 is in 8 million, the Wii is in another 20 million or so, making gaming consoles the leading Internet-connected device already hooked up to TVs.
They’re expected to hold that lead until 2013 when connected HDTVs overtake them, according to Futuresource Consulting.
Studios say that both Xbox and the PlayStation are a key driver of digital movie and TV episode sales after Apple iTunes.
Xbox, which has offered movie rentals and TV show sales through the Xbox Live Marketplace since late 2006 and streamed Netflix Watch Now since last year, has a 31% share of the digital video-on-demand business, second only to Apple’s 52% share, according to Screen Digest. That’s all the more notable given that Xbox doesn’t yet have content deals with all the major studios. (20th Century Fox and Sony are the two holdouts.)
So far, Netflix is the only third-party video service available on any game console in the U.S. The company has an exclusive deal with Xbox 360, but for how long, neither side has disclosed.
Netflix chief financial officer Barry McCarthy told an investors conference in early September that game consoles are the “principle” device for Internet movie services to be on because of the large install base. “In a perfect world,” he said, “we would like to be on the Wii and the PS3 also.”
Both Xbox and PlayStation execs say they are open to adding other third-party services to their consoles, though both seem intent on creating a more curated experience for users rather than adding the broadest array of digital movie stores to their devices, as manufacturers of Blu-ray Disc player and HDTV have done.
“It’s not just about plugging partners in,” Xbox Live general manager Christina DeRosa said of the company’s strategy. “It’s about picking the best and developing the best service around it.”
Lempel said PlayStation would consider adding services that add convenience and are easy to use.
“We don’t want to have a lot of services competing on the PlayStation Network, but if it really brings a good experience to the user and expands our content offering, certainly we’d look at it,” he said.
For studios, game consoles offer another advantage over other living room devices: access to the hard-to-reach and harder-to-market-to core male 28-year-old videogamer demo.
“I don’t think a lot of our audience sits down at 8 p.m. to watch a TV show,” said Lempel. But they are watching on demand. South Park and Family Guy episodes tend to be top sellers on both consoles.
Netflix chief content officer Ted Sarandos said that some of the customers Netflix has signed up from its Xbox partnership weren’t watching movies on DVD before and don’t order DVDs through the service, though they are streaming movies from Netflix.
“They were disengaged from physical media,” he said.
http://www.videobusiness.com/article/CA6698916.html