Movies
US audiences to pay for more online movies in 2012 than for physical videos
MUMBAI: Americans will pay to consume more movies online this year than they will on physical video formats, marking the first year that legal, Internet-delivered movies will outstrip those of DVDs and Blu-ray discs combined.
The legal, paid consumption of movies online in the United States will reach 3.4 billion views or transactions in 2012, approximately 1.0 billion units higher than the 2.4 billion for physical video for this year, according to the IHS Screen Digest Broadband Media Market Insight report from information and analytics provider IHS. As recently as last year, physical video had claimed a commanding share of the market with 2.6 billion views or transactions, compared to 1.4 billion for online.
This year’s online video consumption via the open Internet represents annual growth of 135 per cent from 2011. Online video transactions and videos are also set to continue increasing in the years to come, while physical video sales are expected to decline or stagnate in comparison.
IHS senior principal analyst, broadband, digital media Dan Cryan said, “The year 2012 will be the final nail to the coffin on the old idea that consumers won’t accept premium content distribution over the Internet. In fact, the growth in online consumption is part of a broader trend that has seen the total number of movies consumed from services that are traditionally considered ‘home entertainment’ grow by 40 percent between 2007 and 2011, even as the number of movies viewed on physical formats has declined.”
The physical segment consists of retail sales and rentals of VHS, DVD and Blu-ray discs (BD). The online portion is consists of electronic sell-through (EST), Internet video on demand (iVOD) and subscription video on demand (SVOD).
Key to the surge in consumption of online video has been the rise of all-you-can-eat subscription services such as Netflix and Amazon Prime, which offer customers unlimited on-demand movies for a flat monthly or annual fee. The result is that subscriptions in 2011 accounted for 94 per cent of all paid online movie consumption in the United States, compared to just 1.3 per cent of units consumed that were bought on an ownership basis via electronic sell-through.
Although it is declining, physical video this year will still command more viewing time from Americans, who will spend an estimated 4.3 billion hours on DVDs and Blu-ray discs, compared to 3.2 billion hours for movies online.
And although online will account for the majority of transactions this year, it is set to attract a far lower share of revenue in 2012, at $1.7 billion, measured against $11.1 billion derived from physical formats. This is because consumers will pay an average of 51 cents for every movie consumed online, compared to $4.72 for physical video. The pattern will likely remain unchanged even by 2016, with online accounting for 17 percent of revenue, compared to 75 percent for physical video, and pay-TV video on demand taking the remaining 8 percent.
Netflix, while unquestionably the market leader, is not the only online SVOD game in town. Last year saw both Amazon and Hulu develop online streaming businesses at levels unheard of just a couple of years ago. For Amazon in particular, 2011 marked the transformation of Amazon Prime from a discounted shipping offer into a diverse entertainment proposition in its own right, allowing subscribers who paid the $79 per-year service access to a range of movies and TV shows.
The phenomenal growth of subscription movie consumption raises the prospect that as SVOD services become more widely adopted, they become an appreciable drain on the time that consumers would have used to watch movies in more lucrative ways, IHS believes. When this is combined with the possibility that consumers will always find something to watch, the still-nascent EST business could have its wings clipped before it can really take flight, even as consumption reaches previously unattainable highs.
“After more than 30 years of buying and renting movies on tapes and discs, this year marks the tipping point as U.S. consumers now are making a historic switch to Internet-based consumption, setting the stage for a worldwide migration of consumption from physical to online. We are looking at the beginning of the end of the age of movies on physical media like DVD and Blu-ray. But the transition is
likely to take time: almost nine years after the launch of the iTunes Store, CDs are still a vital part of the music business,” Cryan said.
Hollywood
Disney sells out ad slots for 98th Oscars broadcast
Strong demand for live events turns the Academy Awards into a global, multi-platform marketing moment
NEW YORK: Hollywood’s biggest night has also become one of advertising’s hottest tickets. Disney has sold out all advertising inventory for the 98th Oscars, underscoring the growing demand from brands eager to ride the cultural wave of major live events.
The sell-out marks the sixth consecutive live tentpole success for Disney Advertising. The streak includes last year’s 97th Oscars, the 59th Annual CMA Awards, and Dick Clark’s New Year’s Rockin’ Eve with Ryan Seacrest, signalling strong appetite among marketers for moments that bring audiences together in real time.
For advertisers, the Oscars are no longer just a single night of glitz and gold statues. Disney’s “Content Everywhere” strategy has expanded the awards show into a sprawling, multi-platform brand playground spanning linear television, streaming, social media and digital content.
“Live continues to be one of the most powerful ways for brands to connect with engaged audiences at scale, and the Oscars represent the very best of culture, creativity and community,” said Disney Advertising SVP, entertainment and streaming solutions John Campbell. He added that the company has reshaped the show’s commercial potential into a connected experience that stretches well beyond the broadcast.
Brands such as Mazda, Pfizer and Volkswagen of America are tapping into Disney’s wider ecosystem, appearing across original content segments including Know Your Movies on Hulu and Critically Acclaimed on Disney+. Partnerships also extend to social media through TikTok Pulse Premiere and to custom brand storytelling created by Disney CreativeWorks.
The result is what Disney calls the “Oscars Everywhere” approach. Rather than a few high-profile ad breaks, advertisers now find themselves woven through a series of moments before, during and after the ceremony.
These include On The Red Carpet at The Oscars, a live pre-show syndicated across major local markets and streamed nationwide, and the After the Oscars Show, which keeps the conversation going once the final award has been handed out.
This year’s sponsors include Rolex, returning for its ninth year, and Burger King, which joins the Oscars advertiser roster for the first time. Other brands in the mix include Disney Cruise Line, Dunkin’, Eli Lilly and Company, Eucerin, Intuit TurboTax, L’Oréal, McDonald’s, Microsoft, Miebo, Paris Baguette, Peacock, Starbucks, State Farm, Toyota and Verizon.
The 98th Oscars will take place on March 15, 2026, at the Dolby Theatre at Ovation Hollywood. The ceremony will be broadcast live on ABC and streamed on Hulu, reaching audiences in more than 200 territories worldwide.
