Verizon (NYSE: VZ) wants a bigger piece of the VoD (video on demand) business to challenge cable, satellite and an ever-growing array of over the top video service rivals, and is working to garner distribution agreements with all of the major studios in addition to offering a two-day rental to tempt consumers to rent more movies and television programs.
Beginning with 20th Century Fox's "X-Men: First Class," Verizon will promote its 48-hour VoD rentals through its FiOS TV offering. The telco's move could also have a rippling effect on the video rental world, where cable and satellite operators have 24-hour rental windows for new titles. Verizon prices its titles at $4.99 in standard definition and $5.99 for HD versions.
What's helping Verizon make this move is the movie studios' willingness to extend digital rental times for new movies as a result of growing VoD revenue. According to a study by the Digital Entertainment Group, VoD earned $929 million in 1H2011, up 4 percent over last year. Meanwhile, video streaming VOD service such as Netflix increased 46 percent to about $1.6 billion.
As it looks to further differentiate itself from cable and satellite, a big motivating factor for Verizon is to scale its library of VoD titles. As of April, Verizon had 24,000 titles in its FiOS VoD library, with 15,000 of them being free. By comparison, Comcast (Nasdaq: CMCSA) has about 25,000 VoD titles and Netflix (Nasdaq: NFLX) over 20,000 titles.
- Variety has this article
Special report: IPTV in the second quarter of 2011
Verizon's Shammo: Strike, hurricanes could impact Q3 FiOS subscriber numbers
Verizon Q2: Cloud services and FiOS fuel the wireline engine
Verizon's Q1 wireline results get EBITDA boost from FiOS and enterprise services, but revenue misses forecasts
Verizon's Q4 revenue slips slightly while broadband, business revenue grow