TV DVD Box Sets Get ‘Streamed’30 Nov, 2010 By: Erik Gruenwedel
Tis the season for packaged media box sets, right?
Not so fast says analyst Richard Greenfield, who believes Netflix’s increasing access to relatively fresh episodic programming will have a chilling effect on TV DVD box set sales through Christmas.
The BTIG Research analyst has been a long-time critic of studios fast-tracking content to lower-margin distribution channels such as kiosks (Redbox) and streaming platforms (Netflix) – a strategy he says undermines sellthrough.
With Netflix’s new streaming-only service (and by-mail) offering all but the most recent seasons of popular TV programs, conventional wisdom suggests that even with national print publications such as the New York Post, Kansas City Star and USA Today touting complete-series boxed sets of "24" (seasons 1-7 for $350), "The Tudors" ($131), "Lost" ($230), "Deadwood" ($150) and Mad Men: Season 4 (pre-order for $49.99), among others, disc sales will suffer.
Availability of TV DVD on Netflix is not new and has helped undermine disc sales in recent years with little apparent concern from studios, according to the analyst. With Netflix streaming available on nearly 200 consumer electronics devices and CEO Reed Hastings declaring TV content to represent 50% off all streaming, devaluation of physical media in regards to TV DVD is nearly complete.
“What amazes us is that TV content owners are making TV streaming rights available to Netflix,” Greenfield wrote in a post. “It will be interesting to see if Hollywood executives can resist Netflix’s short-term cash, in order to protect their DVD ‘cash cow’ or whether they at least start adding some ‘000’s’ to the annual rates they charge Netflix for content.”
Indeed, seasons of "Mad Men" represent some of the current best-selling discs on Amazon, including Season 1 ranked No. 8, Season 3 (No. 9) and Season 2 (No. 11).