“Movie services such as Blinkbox compete in a different way with the payTV operators, we live more in a pay-as-you-go society and choices are always changing,” contends Blinkbox CEO Michael Comish. “Blinkbox is more competition for your local video store as our service is in the DVD window not the payTV window.
However, where we do compete is in the on-demand arena. Our target audience is non payTV homes who now have access via the internet. As Netflix has shown, it’s not an either-or, but both. PayTV viewing has not decreased; it’s grown, with Netflix being an additional service complementing the other services which continue to be consumed.”
Analyst Companies and Markets believes that online film forecasts the market to reach $4.44 billion by 2017 with Amazon, Microsoft, Rovi, Sony Computer Entertainment and Walmart the main players alongside Apple and Netflix.
However, it cautions that even though online movies have been increasing in popularity, they are unlikely to provide studios with a primary revenue stream soon. As consumers switch to cheaper rentals from OTT sources, the result will likely be lower revenues for Hollywood studios.