Netflix has an innovative revenue sharing agreement with the studios. So you would think there would be incentive not to run out one or another copy of a multi-part series. I’m less likely to start in on a sequence of 8 DVDs if one of them is apparently unavailable. Worse, I might even consider switching over to one of Netflix’s anime-providing competitors.
I assume the problem is technological. But shouldn’t it be cheap and easy to burn new DVD’s on an on-demand basis? In other words, how much would it cost to burn and label single DVDs assuming that Netflix ordered hundreds of different titles each month? We could even assume a backlog of 1-6 months, so that the burners would be operating at 100% capacity.
Yes, the DVDs that I create on my computer can be erased, while the technology for store-bought DVDs is different. Is the latter method really that hard to adapt to a single DVD production model? Or is this an issue of the studios keeping a tight and somewhat paranoid grip on their intellectual property?
Bonus question: why wouldn’t Netflix make the odd flicks available in a streaming version? Presumably that’s a cost issue as well, but given that storing 4.5gigs might cost them all of sixty cents it remains a puzzle.
It’s all about licensing and not so much about technology or cost. The media industry is having a very hard time understanding all these new-fangled technologies. They learned the business and developed the models when you had vinyl, radio and live performances and that’s still all they fully understand. They opposed recordable audio tapes and VCRs until the courts shot them down and they’re still opposing digital media and on-demand technologies.
So when they give Netflix a license to buy a manufactured DVD and ship that to customers that’s the only permission Netflix has unless something else is specifically negotiated and agreed to. For that matter, the contracts often deal with regions of distribution - you can show this movie to those people, but not those other ones. (This is why DVDs themselves are coded by region.)
Burning a DVD like you describe would be ridiculously cheap - certainly less than $1 even factoring in hardware, labor and consumables. It really is not a technology problem.
I know that Disney once experimented with DVDs that would run once or twice and then cease to work. I don’t know how it worked, but the fact that places like Netflix aren’t using them makes me think they weren’t all that effective.
Rights in general are complicated things. Even something as trivial as a song played through a radio on a TV show can hold up the release of a series on DVD; this is what kept WKRP in Cincinnati shelved for so long. Cite. Royalties are also a problem; one of the issues with the recent writer’s strike was over increased residuals for DVD and electronic distribution.
Rights may also be held up for other reasons. Metallica bought the rights to the film Johnny Got His Gun; they wanted to use clips for their “One” video, and it was cheaper to buy the rights to the film rather than license clips. Consequently, the film wasn’t released on DVD until 2007 or 2008. Rights management isn’t Metallica’s primary business, so it’s possible that it just never occurred to them that there was a market for the movie.
Burning a new DVD seems simple to you and me, but to a corporation like netflix they’d have to set up an automated process.
It takes about an hour to burn a DVD on a home PC. Doesn’t seem like much time, does it?
For Netflix, ordering a New DVD is an automated process and the total labor commitment to each new DVD they bring in is closer to a minute or two per DVD. Simply label the sleeve, drop in the DVD and set the DVD into the automated inventory system.
Netflix probably doesn’t want to get into the business of burning DVDs on-demand. They certainly wouldn’t want to do it on a rare or one-time basis. They’d have to invest in commercial grade DVD writers, arrange for Studio approved DVD images, track the number of DVD’s they created, perform quality assurance, etc. The end cost of it all would have to be less than they spend by buying the DVDs from the studio/distributer.
That’s not to say the business model wouldn’t work - I’m not going to do the math/model. But it’s not a direction Netflix has chosen to go - yet.
Of course, with disck based technology already on the fade, it’s probably not as good of a long term investment as say, marketing their on-demand rentals.
Not sure that this is relevant, but I’m fairly sure that some of the DVDs I get from Netflix are not the same as the ones you get when you purchase a movie. DVDs for sale usually have full color graphics on them while some of the Netflix rental discs have monochrome printing.
And instead of burning DVDs on-demand, I think Netflix would rather offer the movie for streaming viewing. (They have tens of thousands of disc for rental but only about 12,000 for streaming viewing, specifically because of licensing agreements.)
Rental DVDs and Retail DVD are not the same versions.
Rental DVDs almost never have a second disc bonus features and often the bonus features on the original are limited.
Movie Producers would rather the end customer buy Retail DVDs than rent or buy used Rentals so there are usually features available on the Retail version not available on the Rental Version.
Ok, but if there really isn’t a problem with technology or implementation, then they are leaving money on the table. Collectively, Hollywood has an interest in making their products conveniently available, due to competition from P2P networks. Individually, a Netflix item not rented from one studio will be rented from another.
They could subcontract it though.
Googling, I see that in January 2008 Sony and HP penned an agreement on DVD manufacturing on demand. I see that Amazon announced a DVD on-demand program in 2006. Warner Bros sells on demand disks in-house. But I can’t see evidence that any of this has caught on in a big way.
As dracoi and others have pointed out, licensing can get complicated. Maybe the financial crisis has also slowed the process down.
Burning a DVD-R probably costs under a quarter. I take it that it is the impression of everyone here is that burning a permanent DVD isn’t that much more expensive.