Digital distribution is a type of content distribution that takes the form a transferring media content electronically, this includes outlets such as Amazon, Netflix, iTunes, YouTube and many more that all facilitate the purchase and distribution of media content in a non physical form. As opposed to more traditional and somewhat dated methods of content distribution such as DVD rental stores and music/CD outlets. These institutions are fast becoming irrelevant due to the convenient nature of digital distribution methods, which are both convenient for consumer and producer.
I believe digital distribution is the future of content distribution because as the internet advances in ease and fluidity and the new generation is raised not knowing of a time without the internet, these practices will become increasingly popular until they are widely accepted as the norm.
However I believe services can be offered surrounding media content that cannot be acquired or imitated at home without expending a small fortune, such as cinemas, live music events or special interest offers such as deluxe editions for a bands new album featuring bonus items. If I really enjoy a cinematographer or director I’ll want to see their film, on film at the cinema as it is a much more pleasurable and accurate experience. Likewise, if I enjoy a band I may download or purchase their music online and not purchase their CD but will pay for the experience to see them live.
Netflix is a digital distribution service that specializes in the on-demand internet based streaming of film and television. Since their IPO in 2002 Netflix now boasts over 57 million concurrent users with $1.2 billion revenue in 2013.
HBO, a major cable television network launched in 1972’s revenue in 2013 was $1.3 billion, illustrating just how far Netflix has caught up to such an established media distribution outlet in a marginal amount of time.
The Netflix model of releasing programs as one complete piece of a shock for most consumers who are used to viewing a series over many weeks, with one or even two maximum scheduled episodes per week.
This was the way television worked for over 50 years before people realized they didn’t have to conform to a set viewing schedule. The rapid introduction of the internet into mainstream culture gave birth to the concept that you can watch what you want when you want it and in many cases, albeit illegal, for free. Netflix capitalizes on this concept, understanding that almost all media content is freely available online with relative ease in the modern technological climate, they asked the question “how do we get people to pay for media content online?”.
The answer is in their model, they offer full length seasons of quality programs for an extremely affordable price on-demand. Many of these programs including television series, documentaries and films, many of which are exclusives meaning the only publisher who can distribute them is Netflix. These exclusives such as House of Cards, Orange Is The New Black, Better Call Saul and many more are another major draw for potential consumers for the simple fact that they’re good and only on Netflix.
According to Wall Street analysts Craig Moffett and Michael Nathanson’s report on the state of the cable TV industry, Cable operators lost over 687,000 subscribers having only gained 574,000 in 2013, resulting in a 113,000 net subscriber loss.
“The pay-TV industry has reported its worst 12-month stretch ever” – Moffett and Nathanson.
This illustrates the how the convenience and modest pricing of digitally distributed content is quickly trumping the entertainment powerhouse that TV has been for over 50 years.
An example of the benefits that can be attained using digital distribution is shown through how comedian Louis CK distributes his comedy specials. The last three comedy specials Louis CK has released have been made available exclusively at his own website for digital download at the flat price of $5. The specials include:
– 2011: Live at the Beacon Theater
– 2013: Louis C.K.: Oh My God
– 2015: Louis C.K.: Live at the Comedy Store
This self dubbed “experiment” by Louis CK was a giant leap for the comedy industry, even impacting on the entertainment industry as a whole. The idea of cutting out the middle man is very appealing for artists like comedians as they are very reluctant to alter or censor their content, which many distributers such as Comedy Central or HBO will often require you to do.
The file which is offered for download for these specials is not under any DRM, or Digital Restrictions Management; DRM is a technology that is built into an electronic product or service with the aim of limiting use after it has been purchased, this includes disallowing the copying of the file, the amount of times the file can be viewed and the period of time the file can be accessed under.
The fact that Louis CK’s $5 specials were covered by no DRM meant that the files could be easily pirated and shared after being purchased. Louis CK accompanied “ Live at the Beacon Theater” with this message on his website:
To those who might wish to “torrent” this video: look, I don’t really get the whole “torrent” thing. I don’t know enough about it to judge either way. But I’d just like you to consider this: I made this video extremely easy to use against well-informed advice. I was told that it would be easier to torrent the way I made it, but I chose to do it this way anyway, because I want it to be easy for people to watch and enjoy this video in any way they want without “corporate” restrictions.
Please bear in mind that I am not a company or a corporation. I’m just some guy. I paid for the production and posting of this video with my own money. I would like to be able to post more material to the fans in this way, which makes it cheaper for the buyer and more pleasant for me. So, please help me keep this being a good idea. I can’t stop you from torrenting; all I can do is politely ask you to pay your five little dollars, enjoy the video, and let other people find it in the same way
This example of completely bypassing distributers or middle-men may be the future of media content distribution, offering both benefits to consumers and producers. However lesser-known content creators would have a difficult time receiving as much attention and sales as Louis CK if they attempted his method of a completely self facilitated production and distribution, as they would not have the initial capital or brand awareness to do so. However other avenues like iTunes allow independent artists to get their content online and for sale without the hassle of being picked up by a publisher and being under a strict contract.
Piggybacking off of the colossal popularity of apple products, mainly the iPhone and for the inception of iTunes the iPod, iTunes has been able to make itself the hub for digital music sales. Everybody who uses an iPhone has iTunes, whether it be a version on their computer or the application version within the phones OS. Apple requires iPhone and iPod owners to use iTunes in order to put media onto their device, whereas competitors like Android freely allow almost any form of media to be transferred to the device from any source. By limiting the freedom of their consumers, Apple is able to profit from many avenues including the sales of the devices, purchases from the App Store and purchases from the iTunes store as users must purchase content through these avenues to have it on their devices. Due to the fact that 25% of U.S cellphone owners own an iPhone and that 575 million iTunes users, Asymco analyst Horace Dediu estimates that iTunes covers around 3 quarters of all digital music sales in 2013 amounting to over $6.9b. iTunes also accounted for $380m in film and $1b in television programs.
The process for publishing content to the iTunes store is fairly accessible and streamline for those with a US Tax ID meaning that it is widely available for independent artists to distribute their content with relative ease and no real risk. Whereas a few years ago bands would need to be signed to a label and/or spend up to thousands of their own money to produce physical copies of their music for sale and distribution, which would go unsold if they were unsuccessful resulting in a substantial loss.
Digital distribution is a much freer alternative for independent content creators to expose consumers to their creations and perhaps make some money from them with a lot less risk than was previously required. However could this ease and accessibility flood the market with sub-par or low grade content from independent creators who have no business offering their content for sale? or will good content still rise to the surface through the mountains of shit by the power of the internet and word of mouth, rather than being backed by millions of dollars of mainstream marketing and brand awareness?