Blockbuster: Netflix patents are baseless

You're wrong on all counts.

The only issue affecting wide spread of VOD is not technical but licensing. Always late to embrace new technologies, the studios don't want to kill their DVD cash cow. But the release window is closing.

VOD will gain acceptance with TV shows and then slowly but surely you will not remember a time when you had to go the video store- and then make a return trip, or wait for the mail to arrive.

Look at just one cable company's VOD offering today.

http://www.io.tv/index.jhtml?pageType=movies

HDTV does not require anything above what any HDTV cable or telecom viewers already need to use.

Those are today's prices and $5 looks good compared to two trips to the video store. The DVD extras can follow, it's just a question of storage on the company's servers.

VOD will change everything about TV watching. There are producers working on bring movie premieres directly to the home on VOD.

Imagine for example is the entire nation was capable of receiving VOD, it's still far from that possibility today. Imagine all the large screens HDTV's. Now imagine if THE PASSION had premiered on VOD, instead of at the theaters, at let say, $40 a viewing. (Cheaper then going out). Would twenty million homes have ordered it immediately when it became available? $800M in revenues in one shot. With much less expense.

Two years ago Bill Gates predicted that DVD's will disappear within 10 years. Makes sense to me.

$5 might look good compared to two trips to the video store, but it doesn't look good compared to $18 a month and averaging better than 12 movies a month through NetFlix.

I don't think VOD will change everything about TV watching, I think it will piggyback nicely with what DVRs are already changing about TV watching. There are also producers working on simultaneous theatrical and DVD releases, already been done a couple times with small movies.

$40 bucks a viewing? I suppose that's cheaper than going out if you bring a lot of people and don't hit matinee, but I get in an out of a movie theater for usually about $10 a person. Which brings up part of the problem with VOD instead of theatrical (which, BTW, has no effect one way or the other on TV watching), finding the price point that maximizes profits but doesn't cause customer to balk, for some $40 would be cheap, for others ridiculously expensive, so how do they find a way to make at least as much from a family of 4 as they do now but not price the individual or couple viewer out of the market? I'm not sure that price point actually exists.

11 years ago Bill Gates predicted thin clients would make a return as part of a "document centric" (his exact phrase) move in the computing industry leading to the eventual deal of the OS, now his company is getting ready to release their fatest client yet. Meanwhile Bill completely failed to predict the internet. Bill's crystal ball sucks. And remember there's a lot of things in the then "future" that were supposed to make other things that already existed disappear and most of the time the first things already out didn't disappear. TV was supposed to kill cinema, cable was supposed to kill cinema, VCRs were supposed to kill cinema, cinema's bad year last hauled in $9 billion domestically, somewhere between $27 and $36 billion in total, so much for the dead cinema.

Although VOD does what DVR's don't, allow you to watch something you did not earlier contemplate wishing to watch, that is not the reason VOD and nVOD will be the ultimate winner. Someone has to pay.

If you use a DVR the way I use a DVR, you don't watch the commercials. Something has to pay for the programming. With VOD you will pay by the use or you will pay by viewing an ad for so much time in viewing what you choose. If you retort that they could force commercial watching by not allowing you to skip them on DVR's, the DVR's lose much of their appeal.

Today's TV is based on schedules. Those are becoming extinct with people time shifting.

The telephone companies are building IPTV networks from the ground up. They are based on an on demand model.

On demand is the only model that makes sense. Maybe it will take longer then I hope, but I see today's TV viewing as the Model T compared to what will be.

TV is moving back to an "internal commercial" (sponsorship, logo placements, etc) model like it had in the old days. You see it a lot in sports ("now let's turn to the game tracker brought to you by Sprint", with the sprint logo in the corner during the whole segment) and home improvement shows (try to watch 5 minutes of any post 2004 Trading Spaces without seeing a Home Depot logo or hearing the name), but it's going to expand (Hollywood has been highly skilled at getting paid for product placements in movies for decades). This will make it impossible to fast forward through the commercials because large quantities of the show are commercials. The good news is as it expands more of a show's time will be spent on the actual show, a commercial hour of TV will no longer be 42 minutes... well it's good news for the good shows anyway.

Today's TV, especially on cable, already understands that schedules are a limitation, that's why they show everything multiple times. Which plays into another strength of the DVR, say I didn't hear about a show before first broadcasting, but hear about it later and it sounds interesting, well I just whip up the DVR GUI and find the a rebroadcast of the show and record it. Even before the DVR the multiple showings was a big tool, I remember in the early days of South Park the Wednesday original showing was opposite something else I liked so I always watched the Sunday rebroadcast. Also the DVD market plays into beating the schedule, with the DVD you can get people to watch shows they missed the entire run of.

And it might work for the the phone companies. I said VOD will take over TV, I just said it won't change everything about viewing TV because 90% of the changes VOD brings have already been brought by other technologies.

On demand isn't the only model that makes sense, and with DVRs and DVDs on demand TV viewing already exists. Scheduled TV won't die, it will change, but it will not die. For people who use DVRs and rent DVDs today's TV viewing is already exactly what you're predicting, that's why I say it won't change everything.

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