I’m watching the first episode of this now. While good, I can’t understand the concept. A cop on trial for killing a suspect? C’mon, I like fantasy but that’s breaking my willing suspension of disbelief.
Sorry for thread hijack for sarky comment.
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Well, it actually costs requires less bandwidth to stream SD as opposed to HD, and Apple/Hulu/Netflix pay for their bandwidth.
But in the larger context, price discrimination is a thing. Shouldn’t airline tickets logically become cheaper as more are sold, since it’s the first sold that have to cover the fixed costs, while the last sold are almost all profit?
Why would it be better if all episodes, be they SD or HD, were $2.79 (which is likely what would happen if they were required to be the same price), and those who wanted to save money had no opportunity to do so?
I’ve tried every streaming device under the sun, and out of all of them, my little $19 Fire Stick is my favorite.
Installed Kodi on it and it plays anything I throw at it - as far as the wifi, I play 1080p video from on the reg and rarely get buffering, so they did something very right there.
The only issues I have are the very sucky YouTube client and the fact that I need to reboot it once a week or so.
Otherwise, good job, Evil Corporation!
Dude - SD, seriously? Maybe you should just go with rabbit ears. How strictly 20th century.
Or $1.50 from Redbox.
Unless you live an hour away from civilization, I can’t for the life of me figure out why anyone would pay $6 to rent a movie you’ll be able to buy for $10 in a couple months instead of ducking down to the corner store to do it for 1/4 the price. I mean, actually going to a theatre and getting the social experience I can see paying for. Buying a physical product like a DVD that you can rewatch any time, and loan out, give away, or sell when you get bored, I can understand.
But really- To see something once, when you don’t even get the bragging rights /immediate gratification of being one of the first to see it right when it comes out? I don’t get how that’s worth $6. Is it honestly worth $4.50 to not have to put on pants?
I mean, I’m pretty anti-pants, but I have limits.
Personally, I think it’s tied into what @nadir_seen_fire was saying. I think they deliberately price rentals high enough that they nudge you into “buying” the download- Which of course, you don’t actually own.
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No amount of resolution will make a crappy movie less crappy.
(Unless it is built upon visual effects. Fabulous fire and glorious explosions! Who cares about the… howdotheycallit… plot?)
Netflix doesn’t do 2-tiered selling of SD and HD content. They give everyone access to HD content and dynamically reduce the quality when connections are slow enough that the movie will start buffering or the user has requested lower quality content in their settings to go under caps.
The bandwidth point is also moot. This 2-tiered selling is still done even when not streaming and buying something to watch later, which can be throttled back to give bandwidth space for other downloads. It’s not the tech companies selling in 2-tiers due to bandwidth, this is the entertainment industry setting prices for content and demanding 2-tiers of prices for it. Bandwidth also doesn’t cost that much, companies like Apple with their own servers typically get unmetered data and streaming a bit more data costs fractions of a cent. Even if you were using something like AWS which does meter data it only costs $0.09/GB and gets cheaper the more of it you use.
The only reason people think data costs anything to stream or streaming HD content is hard, is because the North American telecoms are doing everything they can to stop the countries here from catching up with the higher average speeds you can get in other parts of the world so they can avoid having to update their infrastructure and can keep milking money out of their customers with the same infrastructure they’ve had for decades.
The price shouldn’t be $2.79. The point is that the $1.99 SD content is there to placate people. It’s what allows the industry to sell “HD” at $2.99. People who considered this an unacceptable price for a movie would simply forgo something that should be a given even at the lower price and not get angry, which allows the company to trick others into paying $2.99 and raise the new standard price to $2.99. If SD and HD were sold at the same price more people would be annoyed at the price and it would become harder to sell things at the higher prices.
It doesn’t matter when they send you the bits or how long it takes, it matters how many bits they send. You may pay a flat rate for you internet service, but Hulu/Apple/Amazon/Netflix do not. The more data they send, the more it costs, and this has nothing to do with net neutrality or whether consumers’ ISPs throttle speeds at the consumer end.
I didn’t say it costs that much. The difference between a 16-ounce fountain soda and a 24-ounce fountain soda is also negligible, but that doesn’t mean there isn’t a difference in cost.
I don’t remember having infrastructure capable of streaming HD for decades. I do remember using dialup 20 years ago, though.
You know that the price shouldn’t be $2.79? This is like saying business-class airfare shouldn’t be $4,000 when you can get an economy-class ticket for $400, or that the price of a large soda shouldn’t be $2.29 when you can get a kid-size soda for $0.99.
What makes you think that companies like Apple or Amazon (which has basically never made any money) would be willing to accept less revenue through a change to single-tier pricing? Should Amazon be forced to take an even bigger loss than it already does?
So I’m actually somewhat surprised by this, because my understanding of how major corporations handle networking agreements, having worked at one, is that you pay for bandwidth (as in, connection speed), but we generally have pretty close to full rights to use that bandwidth to it’s maximum potential and we don’t pay per bit or anything like that. We negotiate a 10gig link and that’s our 10 gig link to do with as we please. I’ve never heard or seen anyone care about that.
Now, you can say that there is costs associated with storage of that data and availability and maintenance, but I would say that I pretty much disagree with your view on bandwidth.
Additionally, when you talk about amazon ‘never making any money’, that’s objectively false. They’re an extremely low margin business, and for the last few years they’ve straddled the line, but they still have historically made money (Especially in the 2000’s, where they were operating pretty closely with WalMart in terms of profit margin), and much of their current losses appear to be expanding business that they’re banking on paying dividends in the future.
Unlike most companies, the core business of a place like Netflix is delivering bandwidth, and even if their networking agreement is as you describe, the number of SD videos that saturates a link they have paid for will require additional links at additional money if people start getting ordering HD videos instead.
From 2009:
Based on the high volume of movies Netflix is streaming each month, it is getting a very good rate in the market. I estimate the company is paying, on average, about 3 cents per gigabyte delivered across Limelight and Level 3, and it could potentially have a slightly lower rate.
From 2011:
While most video contracts with third- party CDNs are typically priced on a per- gigabyte-delivered model, Netflix and other large content distributors usually pay the CDNs on a per-megabit-per-second-sustained model. They pay not for the total number of bits they transfer each month but rather the total amount of bandwidth they peak at each month, a pricing model also referred to in the industry as 95/5. This means that customers can burst above their committed rate of megabits per second less than 5% of the time with no penalty, but once they go over that, they pay for overages.
However Netflix buys their bandwidth, sending video in HD as opposed to SD is going to end up costing them more.
Fair enough. Amazon has made a small amount of money, but not nearly what one might expect from the dominant (online) retailer of out time. Their margins are razor thin, and they’ve made less than 3 billion in net income since they went public in 1997 (Wal-Mart made 16 billion last year alone). As you say, this is because they prioritize market share over profit at this point in their history. Oversimplification aside, the point remains that Amazon is an extremely low-margin business and because they sell HD at $2.99 and SD at $1.99, it’s not the necessarily the case that the $1.99 price incorporates all the costs of the product and that the $1.00 difference represents pure profit.
According to here, Monty Python and the Holy Grail is 1.00 and 3.65 gigabytes for SD and 1080p versions. At 3 cents per gigabyte, the difference accounts for 7.95 cents.
For Hugo, the quoted sizes are 1.74 and 4.84 GB, and the cost differential is 9.3 cents.
You are right that the $1 is not a pure profit margin. $0.9 is still a quite good difference, though.
In order for there to be a $0.90 profit margin on the HD version you wold have to show that they are making a profit on the $1.99 SD version.
I can buy an airline ticket for $79, but other economy seats on the plane may sell for $500. Does that mean that the airline is making $421 in pure profit on the $500 seat?
Price discrimination is generally more complex than that.
We can safely assume they do. We can safely assume that a significant percentage of the users select SD (face it, HD is not so much of difference for most of the content), and that segment would only bleed the service’s money that could be saved easily by scaling down and buying fewer of the thick pipes.
The comparison with an airplane does not work so well, as the bird has to be filled; a difference in cost per flight between a full bird and a half-empty one is not so major, and an empty seat loses more money than a discount ticket. (Then we also have the fairly invisible-to-the-passenger load, known as the Cargo. That is a very significant profit generator even, and especially, for the budget airlines.) Scaling down air traffic is less easy than scaling down internet connectivity, for a plethora of reasons including schedules and cargo haul contracts.
Oh, we can safely assume you’re right because you say you’re right. I see. I suppose we can safely assume that DVD outsells BluRay in the US, too, or that most people on Netflix stream SD.
As I discussed earlier, price discrimination applies to lots of things, from soda to airfares. Price does not reflect cost.
Also, as I said earlier, the high fixed costs of airlines means that the cheapest seats cover the fixed costs, while the expensive seats that are the last to be sold are almost pure profit (at least according to the sort of analysis we’re doing here).
To a cetain extent, the list price for blurays isn’t stable. Depending on where you buy the things, the price may be less than or equal to the price charged for DVDs. The price is a whole lot more stable on the ITunes shop. I haven’t really looked into Amazon’s pricing.
Apparently, the “filmed in a soundstage highschool gym” nature of Evil Dead is readily apparent from the bluray.
There are, of course, other films that put way too much faith in CGI for their own good. Perhaps a diminuation of detail would help mitigate this impression.
i like HD. Then again, I like costume drama. If the dialogue bores me, I can always focus on the clothes.
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It’s never no-pants day outside.
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It’s pretty much designed to make you go, ‘OK, fuck it, I’ll just buy Prime’.
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I live within driving distance of a few Red Box kiosks, but I can’t really see the appeal; for me, RedBox just brings back that old video store experience of “What do we want to watch? Well what do they have? Do they have the movie we want in stock?” and all those hours I wasted wandering around Blockbuster. Do not want to return to those days. Streaming means a bottomless inventory and a much deeper catalog, integrated ratings, recommendations, and all that other stuff that more than pays for itself in the cost above the $2 rental fee for RedBox. And yes, not having to wear pants is worth at least $4 to me too.
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Lol on the heating your living room comment.
