Streaming Video Revolutionaries Actually Closet DVD-by-Mail Users
by John Paczkowski
Posted on August 19, 2009 at 9:26 AM PT
The digital video revolution may be hastening the DVD toward its end, but there’s quite a bit of life left in the old format yet. Netflix CEO Reed Hastings said as much during the company’s last earnings call when he remarked that he sees its DVD-by-mail business peaking in five to 10 years. And consumer sentiment would seem to bear that out.
Kaufman Bros. analyst Aaron Kessler recently conducted a survey of 700 Internet users (see charts below; click to enlarge) and found that 20 percent of those who aren’t currently Netflix (NFLX) subscribers plan to register for the service in the next five years. Moreover, 68 percent of all respondents said that “the ability to watch videos on the Internet vs. renting from a physical store or by mail” doesn’t much matter to them. Only six percent said that feature is important.
And if DVD rental stores were to suddenly disappear from the face of the earth, 52 percent would turn to a DVD-by-mail service as a replacement. A smaller number, 32 percent, would turn to the Internet.
“DVD by Mail life cycle may be longer than current thinking,” Kessler said in a research note issued today. “While we would agree that a large percentage of the DVD rental market will move to digital in the long term, our survey indicates that the current life cycle of physical rentals may be longer than people think.”
[Image credit: NetFlix Origami]
