Tuesday, October 10, 2006
More Companies Pushing Online Video Technology
Amazon.com recently announced the introduction of it's "Unbox" video download service. Amazon Unbox is poised to compete with Apple's iTunes which added episodes from five network television series and music videos to it's selection last fall. Amazon will offer television shows for $1.99 per episode and movies ranging from $4.99 to $14.99 a piece. It will also rent movies for $3.99 a piece. Apple has plans to sell movies through iTunes, but Amazon managed to get to that market faster than Apple by almost a week.
Although this is an other push toward making it easier for people to watch video on their computers or with the help of their computers it comes hard on the heals of a survey which indicates that most American's aren't interested in watching longer video clips on their computers. The poll, conducted by the Associated Press and America Online, found that though over half of the Internet using population has watched video downloaded from the Internet, only 20 percent of that half have downloaded or watched a television show or full length movie. Shorter clips proved more popular with 72 percent of the people who watch video over the Internet watching news clips and fewer watching other video including amateur video, music videos, and clips from movies. The aspect of the survey that really doesn't bode well for video sold through online stores is that only 7 percent of people who watch video online have paid for it, and almost 75 percent say that they prefer to watch free video even if they have to put up with commercials. It seems that many users of the Internet see it as a free environment and resist paying for content.
There are other problems with online video stores, including Amazon Unbox, Movielink.com, and CinemaNow, that won't help to change these trends. The main problem comes with the licensing agreements that the services have with the television networks and movie studios. These licensing agreements prohibit customers from burning DVD's, which means that in order to watch their downloaded movies and television shows, customers will either have to hook their computers up to their TV's or be stuck in front of the computer for the duration. This also decreases the value of the actual movie or program, because it's one of the few things that can't be backed up in case of a computer crash. It also raises the question of what happens when you upgrade to a new computer: will you have to replace your entire video library? Another downside is that while Amazon Unbox gives you thirty days to watch a rental, you have to finish watching it within 24 hours of starting it.
Other problems come from the online stores themselves. For example, Amazon Unbox provides proprietary software to enable the downloads, but that software is only compatible with Windows XP. The system isn't at all compatible with the iPod or even with older versions of Windows. Some analysts have pointed out that for this reason, Amazon Unbox probably won't be much of a threat to iTunes unless Amazon Unbox makes itself compatible with a portable video device.
The survey also revealed evidence that the public's opinion of online video may gradually be changing. Many people haven't changed their television viewing habits because of online video, but they do use it to supplement normal television. This is especially common with news clips and for frequent travelers who like to download movies to watch on their laptops. Many online video viewers, at least with broadband Internet connections, admit to watching more online video than they did a year ago, and there's also evidence that the increasing prevalence of high speed Internet is making people more likely to watch video online.
The one thing that's clear is that companies are going to continue to make online video content more available.