Further evidence, is further evidence was needed, that physical media is on its way out to be replaced by digital media. Netflix in particular is undoubtedly eyeing a streaming future, pushing its ‘Watch Instantly’ library onto users more vehemently.
Physical to Digital
The move from physical media to digital is happening rather slowly. In fact, it could be classed as a lurch currently. However, there will come a point when it speeds up and becomes all-consuming, with more companies jumping on the bandwagon rather than risk being left behind.
Netflix looks like being one of the early movers. Built on the basis of delivering DVDs-by-mail, streaming now looks like being the main focus of its attentions in years to come.
Netflix ‘Watch Instantly’
Netflix introduced its ‘Watch Instantly’ feature a few years ago. It gives subscribers instant access to a wealth of movies and TV shows, all available to stream via the Internet.
It started as a computer-only affair, but Netflix has spent the last year or so getting the Watch Instantly feature added to a range of other devices. These include the Roku box, the Xbox 360 and PS3, and even Internet-enabled Blu-ray players and televisions.
‘Watch Instantly’ Future
At the beginning of this year, Netflix CEO Reed Hastings stated that the company is likely to offer a streaming-only subscription plan in the future. And in October, it was intimated that there could be an international roll-out of ‘Watch Instantly’ offered along those lines.
Now, Netflix has changed the order of tabs on its Web site to make ‘Watch Instantly’ the first option and the most prominent, with ‘Browse DVDs’ being bumped.
Although only a small change, it has huge implications as it makes Netflix’s position clear – that it wants to encourage more of its subscribers to stream rather than rent DVDs.
And it’s no wonder, as while its mail-order business costs the company $600-$700 million annually, ‘Watch Instantly’ only costs about a nickel per movie. Which is quite a margin.
Conclusions
I don’t think Netflix is suddenly going to abandon its current business model, but it is slowly evolving it so that streaming is a bigger part of the overall strategy. How long until streaming-only subscriptions are offered? I’d certainly be interested.
[Via NewTeeVee]
