May 8, 2020
As expected, with greater numbers of households spending time indoors due to the coronavirus, use of home entertainment options such as transactional VOD have spiked.
In the quarter ended March 31, 14% of U.S. broadband households used a TVOD service over the past 30 days, a five-point increase from the previous year, according to new data from Parks Associates. This service type, which includes Amazon Prime Video, FandangoNow, Redbox, iTunes and Vudu, will increase as more content moves online, including early access to theatrical releases such as Universal Pictures Trolls World Tour or The Invisible Man.
“The idea of streaming current in-theater films was once a concept from a proposed streaming service called The Screening Room,” research director Steve Nason said in a statement. “This service never officially launched, but the COVID-19 pandemic has pushed the concept behind it into reality.”
Nason said the move toward PVOD and shortening of the 90-day theatrical window has been ongoing, but events such as shelter-in-place orders pushed the digital distribution of new theatrical content to the forefront to offset the lost revenue from closed movie theaters.
Parks said the changing distribution tactic is most notable with perennial box office loyalist Disney, which is fast-tracking movies to its SVOD service Disney+. The studio released Frozen II three months before its original planned release and added Onward to the streaming service much quicker than previously anticipated.
Dallas-based Parks says Disney and other studios are continuing to weigh if they should release new theatrical titles straight to VOD platforms and services or push back these titles so they can premiere in theaters as originally intended, when COVID-19 restrictions are lifted.
Nason contends that studios moving more prime content online earlier, increases the risk of piracy for top-dollar blockbusters. He said early windowed content has always been an issue for studios as thieves would sneak video cameras into theaters to bootleg low-quality copies.
“Now, with releases going digital, pirated video will be higher quality, while consumers might feel emboldened to tap into pirated video since theaters are closed,” Nason said. “This will put more pressure on the antipiracy efforts among video content and service providers.”