Best Buy: Delays on DVD rentals boost sales. (cnet News, 4/14/2011)
Excerpt: The sales-only window got its start in January 2010, when Netflix and Warner Bros. Home Entertainment announced an unprecedented deal. Netflix would delay renting the studio's newly released movies and then would use the money saved from purchasing new releases to acquire more content for its streaming-video service. Redbox soon agreed to honor a sales-only window and two other Hollywood film studios, NBC Universal and 20th Century Fox, also adopted similar windows.
The windows were designed to help protect sales of DVDs as well as Blu-ray discs, a physical format that is still growing. Overall disc sales for the entire industry, however, have declined for several years. Much of the problem can be traced to consumer tastes, which are shifting toward rental rather than ownership.
A year after the Netflix-Warner deal was struck, some retailers say they're encouraged by the results. If the trend continues, Netflix might be able to use the sales-only window to pen similar agreements with other TV and film companies and that could help the company acquire more streaming content. In many tech circles, the thinking is that the Web will become a dominate means for film distribution.
The transition from physical discs to the Internet, however, will not occur over night, according to John Marmaduke, CEO of Hastings Entertainment, a retail chain that sells books, DVDs, and CDs out of 146 stores in 21 states. He said there's still big demand for physical media, he said.
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