freedquaker said:
Bluray sales will definitely be negatively affected by Netflix, because they are substitutes. It has two affects actually;
a) The more movies you see on netflix, the LESS your chances to buy a dvd or bluray, cuz you have already seen it. Thats true for the movies you want to watch only.
b) The more movies you see on netflix, the MORE your chances to buy a dvd or bluray, cuz you now know about many more movies you would otherwise not know; and among those movies there will surely be those you may want to archieve in a very hi-def format.
These are opposite effects actually a)substitution effect, b)Tranmission effect. The net effect will probably be positive for bluray in the INITIAL period, but the marginal cost will get higher more quickly than marginal benefit (meaning substitution will dominate the Transmission) in the latter periods, so it will simply harm the Bluray overall, due to dvd dominance and increasing competition from online services.
PS: I am a macroeconomist scholar btw:)
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Streaming Netflix and Blu-Ray are 2 totally different target audiences so it wouldn't effect sales of Blu-Ray very much if at all. I am not even sure Sony would use that as an excuse. It may have a small effect on DVD sales, but I don't think that would be the case. I have Netflix and yet I go out and buy DVD's often. I use the streaming service to get things I would never buy or tie up one of my rental ques for. And I feel that would be what most people would do.
"If you've got them by the balls their hearts and minds will follow."
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