On Demand and on DVD at the Same Time
In an attempt to bolster consumer interest in paid video on demand, Comcast, the nation's largest cable operator, has introduced an experimental program to release films on demand simultaneously with their release on DVDs.
Context & Ripple Effects
This experiment lands mid-way through Comcast's broader push into coordinated services: in November 2005 the operator joined Sprint Nextel, Time Warner Cable, Cox Communications and Advance/Newhouse in a joint venture aimed at bundled distribution reaching some 75 million U.S. homes, part of confirmed aggressive competition between cable operators and telecom companies for each other's customers.
Paid video on demand has been the weakest link in that bundle — the article frames the same-day-with-DVD trial as an attempt to give the format a reason to exist. By collapsing the window that made discs the sole early home-video option, Comcast is testing whether its cable pipe can function as a first-run movie storefront rather than a discount archive.
First-order effects
- Studios participating in the trial gain a controlled test of whether day-and-date VOD lifts total revenue or merely substitutes for DVD sales at full price.
- Comcast's on-demand catalog gains exclusive-feeling content its satellite and telecom rivals cannot match without equivalent studio deals, sharpening the customer-poaching contest already documented between cable and telecom operators.
Second-order effects
- Fellow JV partners Time Warner Cable and Cox face pressure to strike comparable same-day deals or concede that Comcast's scale gives it a content advantage within their own joint venture.
- DVD retailers and rental channels lose their guaranteed early-window exclusivity, weakening the leverage they have held over studios' home-video sequencing.
Third-order effects
- If the pattern holds, the sequential theatrical-DVD-VOD window structure erodes toward simultaneous multi-channel releases, shifting home-video economics from unit disc sales to per-view revenue splits with distributors like Comcast.
- Cable operators consolidate a second role beyond connectivity — retail storefront for first-run entertainment — which raises the stakes of the cable-versus-telecom bundling war the industry entered in 2005.
The trend: Movie release windows are beginning to compress toward day-and-date distribution across formats, with large cable operators positioning themselves as the retail channel for first-run films.