According to The NPD Group, even with the increasing number of iVOD-capable devices the vast majority of these devices were not used to rent iVOD movies. Only 5 per cent of the 134 million US consumers who own iVOD-capable devices used them to do so. Even among owners of dedicated streaming media devices, only 14 per cent reported making an iVOD rental transaction.
NPD’s “Movie VOD Monitor” report defines iVOD movie rentals as movies that are rented from the following services: Apple iTunes, Microsoft Zune, Sony PlayStation Network, Amazon Instant Video, Vudu, Best Buy CinemaNow, and Blockbuster.com. Movie purchases or downloads that are permanently owned were not included in NPD’s report. Netflix is classified in NPD’s report as a subscription streaming service, not iVOD.
Although iVOD receives category-leading scores for selection, search, and navigation, it still has not caught on with the majority of mainstream consumers. iVOD may also be struggling due to heavy competition from pay TV operator’s VOD offerings, and subscription movie options, including Netflix. In fact, 56 per cent of iVOD movie renters are also Netflix subscribers and 43 per cent use their pay TV provider’s movie VoD offering.
“The industry is teeing up excellent services for Internet movie rental, but they simply aren’t getting noticed by many consumers,” said Russ Crupnick, senior vice president, industry analysis for The NPD Group. “It’s understandable that smartphone owners might be hesitant to watch a full-length movie with limited screens and battery life, but few of the other connected devices are showing strong uptake for iVOD, either.”
“The various connected devices needed to enable iVOD are already found in enough households to allow this distribution channel to grow well beyond early adopters,” Crupnick continued. “To move the needle forward, though, iVOD providers must now leverage their content selection and search advantages and perhaps take a page out of Netflix’s playbook by offering more free trials to introduce potential users to their services.”