One Billion More Movies Streamed Than Physically Purchased In 2012


William Launder for The Wall Street Journal:

Paid, legal movie downloads in the U.S. are expected to reach 3.4 billion views this year, more than doubling from 1.4 billion last year. Physical video viewing will shrink to 2.4 billion views from 2.6 billion views last year. The trend is expected to continue in the years ahead, according to IHS.

[…] Online viewing is expected to generate $1.7 billion for 2012, compared to $11.1 billion created from viewing on physical formats. By 2016, online viewing will still only account for 17% of associated industry revenue, while physical videos will generate 75% and video-on-demand pay television will account for the remaining 8%; according to IHS.

Consumers will pay an average of 51 cents for every movie watched online in 2012, compared to $4.72 for a physical video.

Amid lingering uncertainty over Netflix’s long-term viability, all statistics and trends point to a thoroughly favorable outlook for the streaming giant.

Original content, renewed marketing efforts, an extensive library, and near-ubiquitious availability each betray a service that is undoubtedly set to guide our media consumption habits for the coming years. Despite Netflix’s relatively low stock price compared to this time last year, I cannot help but feel wholeheartedly optimistic for the company’s future.

The future clearly lies in digital distribution and, with the increased availability of 1080p content, the landscape is becoming increasingly compelling to behold.

As I’ve said many times before, competition is a very good thing, indeed.