For Consumer Product Strategy Professionals

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	March 23, 2009 Video On Demand Must Compete With DVD And The Economic Downturn Develop Improved VOD Strategies To Counter Difficult Market Conditions by Laurence Meyer with Ian Fogg, Tushi Banerjee, Galina Naydenova, Nick Thomas

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Executive Summary

DVD is still Europeans' preferred medium for consuming digital video content on demand. Video product strategies must operate within the context of DVD's current market dominance. Yet TV-based video-on-demand (VOD) uptake is growing fast; roughly 35% of European TV-based-VOD-enabled households use it monthly. As it places the TV set at the heart of the VOD experience and matches the DVD rental experience in many ways, TV-based VOD has the potential to grow at the expense of DVD viewing. However, in the medium term, TV-based VOD will continue to face tough competition from retail DVDs, whose average price across Europe has fallen by 25% since 2003. With the additional threat of increased video piracy due to economic turmoil, TV-based-VOD service providers need to strengthen the consumer experience and define relevant pricing strategies if they wish to boost consumer interest. Content merchandising as well as better integration with the linear TV experience will also help raise consumer awareness. All this will only be possible if providers can sign more flexible licensing agreements with the rights holders.

TABLE OF CONTENTS

• DVD Is Still The Main Way To Consume Video On Demand
• TV-Based VOD Appeals To European Consumers
• Video Piracy And The Current State Of The Economy Are Rivals To TV-Based VOD

RECOMMENDATIONS

• Actively Promote VOD And Prioritize Enhancing The VOD Experience
• Rights Holders Must Allow Innovation And Change
• Supplemental Material
• Related Research Documents

This is an excerpt

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