In a recent Discussion with Skeeter Kerkove Gene Ross reveals that DVD sales are tanking. If adult companies are experiencing a slow down due to a drop in DVD sales, they have no one but themselves to blame. Have these people never heard of the internet? I’ll bet that VOD sales are not down. The addiction of producers to DVD is going to have to be broken and internet distribution embraced if producers want to see their financial misfortunes reversed.
I can only speak from personal anectodes, but I have not purchased a DVD this century. However, I have hundred’s of VOD’s with Gamelink and Empire and have several internet content subsciptions. With the ease of access and lower per scene cost I own a lot more adult content than I did under a DVD format. If adult companies are not making MORE money today, well they’re just not trying.
So what explains the crack like addiction for the DVD format? The only thing I can muster is that video rental stores and their distribution channels are guaranteed to purchase a certain amount of product and those relationships were profitable. Obviously, the distributors had a big say over what content got made. Now adult companies have to sell directly to the consumer and that must scare the hell out them because they have ignored what the consumer wants for years.
Make no mistake, adult companies need to run to an internet/vod distribution system. Those that do will have instant feedback on what and who sells and can pattern their production to that. They will have lower distribution costs and they will need MORE product to satisfy the fact that consumers buy more porn under an internet distribution sytem. Those that stay with the old DVD distribution system will become extinct. This isn’t really economics, its evolution.
TheVODGuy writes: “In my opinion, studios are experiencing drops in sales, DVD and VoD, due to over-saturation. Every week I see new studios popping up, with little to no originality in their product, other than the fact that maybe they sells theirs for $1 less, so Joe Consumer’s more inclined to buy their crap. I don’t know how many of these studios are going to be in it for the long haul, but as for right now, the customer is inundated with new choices.”
DVD has maybe four years left in it. HD-DVD/Blue Ray etc maybe a few more after that if buyers can stomach cottage cheese close ups and zits the size of dinner plates on their TV.
VoD has been running successfully for ages. Rob’s way off the pace. Affiliate programs were great four years ago, but anyone who went to Internext last year (and they were the loneliest four people in the world) would’ve wept at the state of web affiliate program returns.
In the short term, yeah, VoD has legs, but long term you really want to be thinking less in terms of a whole bunch of web sites pushing crap while you hope your affiliates bring the cash in and more in terms of preparing for IPTV.
Any retail solution–VoD or IPTV–which allows you to cut out duplication, packaging, wholesale and retail should give any porn company a boner. Production companies will become their own online TV stations, opening up entirely new marketing opportunities and customers worldwide with fewer censorship issues.
Rob Black is a niche player. Always has been, always will be. His name closes way more doors than it opens and he only has himself to blame.
The market is fucked right now because studios are still pumping out product into a diminishing market. More potential buyers are just stealing their movies from the web and retailers are charging way too much money per unit versus the wholesale price.
It’s the economics of greed in action, and it won’t change until the production houses realize they’ve got a direct route to the customer. If production companies charge fans a realistic amount per download and don’t milk people too hard, then the market will always be there.
Once the infrastructure for IPTV is really there, we’ll see huge changes in the delivery of porn to the consumer.