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NPD: Few Renting Internet VOD

15 Dec, 2011 By: Chris Tribbey

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A mere 5% of the 134 million Americans with devices capable of Internet VOD are actually using them to rent movies, according to a new report from The NPD Group. And of those who own a dedicated streaming media devices, only 14% are making any sort of Internet VOD rental transaction.

“The industry is teeing up excellent services for Internet movie rental, but they simply aren’t getting noticed by many consumers,” said Russ Crupnick, SVP of industry analysis for The NPD Group. “It’s understandable that smartphone owners might be hesitant to watch a full-length movie with limited screens and battery life, but few of the other connected devices are showing strong uptake for Internet VOD, either.”

NPD categorizes Internet VOD-capable devices as Internet-connected TVs, connected gaming consoles, streaming media players, tablets and smartphones, and includes iTunes, Zune, PlayStation Network, Amazon Instant Video, Vudu, Best Buy’s CinemaNow and Bockbuster.com in its research.

NPD reports that Internet VOD tends to be top in terms of selection, navigation and search, but isn’t catching on with consumers, largely due to heavy competition from pay-TV operator’s VOD offerings, and subscription movie options like Netflix. A full 56% of Internet VOD renters also are Netflix subscribers, and 43% use pay-TV VOD.

“The various connected devices needed to enable Internet VOD are already found in enough households to allow this distribution channel to grow well beyond early adopters,” Crupnick said. “To move the needle forward, though, Internet VOD providers must now leverage their content selection and search advantages and perhaps take a page out of Netflix’s playbook by offering more free trials to introduce potential users to their services.”

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