The Future of Entertainment Distribution

Back in November, the online and by-mail DVD rental service, Netflix, began offering instant online streaming-only subscriptions.
The Future of Entertainment Distribution
6/17/2011
Updated:
10/1/2015

<a><img src="https://www.theepochtimes.com/assets/uploads/2015/09/112155559.jpg" alt="Netflix's gamble is paying off.  (Ryan Anson/AFP/Getty Images)" title="Netflix's gamble is paying off.  (Ryan Anson/AFP/Getty Images)" width="320" class="size-medium wp-image-1802517"/></a>
Netflix's gamble is paying off.  (Ryan Anson/AFP/Getty Images)

With the advent of cloud technology and slimmer and more portable laptops and tablet based computing, physical memory drives and optical drives are becoming obsolete demonstrating a trend of changes within the digital entertainment world.

Back in November, the online and by-mail DVD rental service, Netflix, began offering instant online streaming-only subscriptions. This effort came in light of the huge popularity of its streaming service as a wager for a future where all multimedia will be delivered through virtual platforms.

Netflix’s gamble is paying off. During the first quarter of 2011, Netflix and subscription-based movie rental and streaming rose 33 percent, with a 9 percent increase in digital purchases.

On the other hand, according to the Digital Entertainment Group, DVD sales fell 20 percent over the course of a year.

Whilst Blu-ray is up 10 percent, this trend is offset by the quantity of people who have stopped buying DVDs and hardcopy movies completely.

Other companies appear to be taking bets in the gamble too. Apple’s latest and upcoming series of MacBook Airs do not and will not have optical disk readers. Obviously, this is also a step towards pushing dependency on its iTunes service and the recently unveiled iCloud.

Apple’s utilization of cloud technology will allow its devices to instantly and wirelessly stream all forms of electronic entertainment without a single physical connection.

Google is following this trend with its own Chromebooks, which also do not include disk drives and are backed by its own storage cloud.

Nintendo’s newest game console, the purportedly powerful and versatile Wii U, will not support DVDs or Blu-ray. Nintendo’s President, Satoru Iwata, says “the reason for that is that we feel that enough people already have devices that are capable of playing DVDs and Blu-ray, such that it didn’t warrant the cost involved to build that functionality into the Wii U console because of the patents related to those technologies.”Nintendo admits that it believes the cost of further investing in physical mediums of film would be a waste.

When it comes to games, the virtual delivery platform is also taking hold. Steam, a virtual content-delivery service operated by video game producer Valve Corporation, is estimated by Forbes to control between “half to 70 percent of the $4 billion market for downloaded PC games,” and performs distribution for a vast majority of big-name producers.

According to research firm NPD Group, last year “unit sales of PC games via download outstripped sales of boxed games in stores for the first time.”

Consumers are starting to sacrifice ownership of movies for the cheaper path of rentals also. Kiosk rentals, like those from Redbox, rose 30 percent in the first quarter. As the digital world further and further expands the availability of all movies to a constant level, people are seeing less need in owning their individual copies of films.

These statistics suggest that delivering media through physical means is becoming obsolete. Some might say it already is.