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Digital Delivery Not All It's Cracked Up To Be

19 Jun, 2009 By: Thomas K. Arnold

Analysts, for some unknown reason, might still love downloads over packaged media. But what's known in the biz as "EST," for "electronic sellthrough," has been getting quite a bum rap of late, chiefly because consumers don't seem to want to spend $20 or even $12.99 for a downloaded movie when they can get the real thing for about the same, or even less.
There's a great column in Electronic House by Arlen Schweiger called "Blu-ray vs. Digital Downloads: Tale of the Tape."  Arlen makes a compelling case for why he believes Blu-ray Disc, as the new standard-bearer for packaged media, will prevail. He notes the quality is unsurpassed, while "pickings are slim if you're searching for HD downloads in 1080p." The same goes for audio quality, extras and even content availability, when you factor in DVD (and you should, since all Blu-ray players are backwards compatible).
And while a certain segment of the population certainly will be drawn to the ease and convenience of digital delivery (chiefly on the rental side, however), "for dedicated home theater/projection system owners, who realize the quality difference between Blu-ray and everything else, it's a no-brainer."
And my point earlier about analysts loving downloads may be eroding quicker than we think. Our senior editor, Erik Gruenwedel, wrote a great story (click here to see it on our Web site) titled "Show Me the Money: Analysts Sour on Streaming." He noted that while analysts by and large are still "enamored by the promise of streaming," a growing number of them now 'contend a Pandora’s box scenario is emerging that could result in revenue and margins that pale in comparison to the traditional business models.... Laura Martin, analyst with Soleil Media Metrics, said the rush to migrate professionally produced TV content on the Internet for free could turn out to be 'anti-consumer,' 'anti-media' and even 'anti-America'."
Food for thought, eh?


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