The UltraViolet initiative (the online digital library that frees you to choose how and where you want to enjoy your movies and TV shows) has come under attack with the recent Paramount activity on that front. According to one analyst, pricing strategies indicate that studios are paying only lip service to digital delivery, and their interests remain firmly rooted in physical media.
Paramount recently released Paranormal Activity 3 as an all-digital version so that there is no need even to buy a disc, and launched ParamountMovies.com where consumers can access digital rights to UV content directory with the studio. “On the ParamountMovies.com website, a recent movie from 2010 costs $22.99 to buy rent in HD, yet a movie that is thirteen years old is only $3 cheaper and still costs $19.99,” Frost & Sullivan analyst Dan Rayburn fumed in his StreamingMedia blog.
According to Rayburn, the studio’s digital pricing strategy will alienate consumers: “What studio executive thinks consumers are going to pay $22.99 to stream a movie when we can buy the DVD for $7 or rent it for less than $2?” he asks. “The economics don't make sense for how the studios price digital content and the fact they are keeping Netflix and others from even renting physical discs, only so they sell more DVDs, clearly shows where their true interest lies - and it's not in digital.
“At some point, the studios are going to get burned just like the music industry did and while they spend a lot of time complaining about piracy, they need to wake up and realize that consumers are demanding digital content, for a fair price. So far, the studios are not willing to give it to them and over time, are going to see their business models crumble as of a result. They own arrogance is going to be the death of their legacy business.” For more facts and opinions on the UltraViolet initiative, read the article in Issue 13 of Digital2Disc and on our website.
