Time Warner Cable Conquers Fear of Video-On-Demand

What's taking 'em so long?:That's what I've been wondering with video-on-demand, and why there are woefully few titles available on my Time-Warner Cable (TWC) and why they're so dated (relatively speaking) to actual DVD release times.

The answer has been that movie studios are afraid video-on-demand will hurt DVDs and, therefore, revenue. But a report today by Thomas Weisel analyst Gordon Hodge says that in the wake of tests, executives of Warner Bros told a conference that they're moving closer to releasing video-on-demand at the same time with DVDs. They found in markets where this has been tested, there was a 50% lift in video-on-demand sales, while DVD sales rose by 10%.

No surprise that video-on-demand rose. Ever been to a Blockbuster (BBI) lately looking for a movie on a Friday or Saturday night? (Hint: They're often out. Not so for the nearby Hollywood Video, which always seems to be empty, though well-stocked!) Who needs either when you can flick a switch at home, which we do whenever the skimpy Time-Warner video-on-demand library has a movie we want to see?

According to the Weisel report, Warner says it plans to move to day-and-date release of video-on-demand and DVD in Belgium and Scandinavia. Hodge believe the winners will be studios, including Gaiam (GAIA), Lion's Gate (LGF) and Marvel (MVL). Losers: Netflix (NFLX) Blockbuster and Movie Gallery (MOVI).

Comments

[James Wilcox]

Hollywood still doesn't understand the value they could provide by having VoD available on the same day that theatrical releases come out. Stay at home mom's and other people unable to trek down the the local cinema would jump at the chance to be able to see a first run movie in the comfort of their own home and they'll pay for it too.

The studio that is bold enough to do this is the one that's going to win the VoD war.

The Proficient Investor