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Will Mounting TV VOD Deals Hurt DVD?

11 Nov, 2005 By: Erik Gruenwedel

TV shows-on-demand are gaining momentum just as TV DVD has become a mainstay of the packaged media business.

CBS, in partnership with Comcast, last week became the first broadcast network to offer its most coveted programming through VOD with a cable provider. Meanwhile, NBC went the satellite route, offering its top shows on demand from DirecTV. This comes after ABC made its top dramas, “Lost” and “Desperate Housewives,” available on Apple's iTunes.

It all begs the question: Will VOD kill the TV DVD star?

Many media analysts said packaged media, in its current form, is relatively safe for now, but times are changing, and quickly.

“For $2 [on iTunes], you get a very small, low-resolution version of the TV program, whereas on DVD you get a much higher resolution with extra bonus material,” said Fred von Lohmann, senior intellectual attorney with the Electric Frontier Foundation. “I don't think it is going to put much of a dent into the TV DVD market.”

Jon Peddie with Peddie Research in Tiburon, Calif., said the screen size makes extended portable viewing impractical.

However, speaking last week at the TV DVD 3 Conference, Marc Rashba, VP of catalog and TV marketing for Sony Pictures Home Entertainment, said TV was a great genre for the mobile market. “[TV content] is a little more digestible on a small screen than two-hour feature films,” Rashba said.

Analyst Russ Crupnick, with The NPD Group, Port Washington, N.Y., said the shift in consumer habits could create “a little bit of cannibalization.”

Comcast Digital Cable customers in CBS-owned television station markets will be able to see episodes of “CSI: Crime Scene Investigation,” “NCIS,” “Survivor” and “The Amazing Race” on Comcast's On Demand service for 99 cents per 24-hour window. NBC's agreement gives DirecTV Plus DVR customers access to such shows as “Law & Order: SVU,” “The Office,” “Monk,” “Surface” and “Battlestar Galactica” for 99 cents each until the following week's episode airs.

David Poltrack, CBS EVP of research and planning, reportedly said he would prefer a business model where a program was available on VOD for a 14-day window and then withdrawn for release on DVD with bonus features.

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