Video On Demand and more recently TV and video streaming operation, Netflix, has revealed that it expects the DVD rentals by mail market (which it pioneered) to peak by 2013 and to be gradually replaced by direct streaming of video content direct to consumers. The slideshow highlights a number of key threats to the pay per use model:
- Increased threats from piracy and cheaper competitors.
- Potential risks as a result of ISPs raising broadband costs (i.e. lack of capacity for video)
- Advertising based streaming providers using CPM models rather than rentals to offset costs
Of course, the Elephant in the room not discussed by Netflix is Google & YouTube. Readers may find this SEOBook.com article by Aaron Wall on Google’s move into TV of interest also.