DVDs/Netflix: disc world

At Netflix streaming has long dwarfed DVD rentals, with 193 million subscribers paying to access nonstop entertainment online. Photo / 123RF

Lex COMMENT

Across the US, more than 2m people still receive Netflix DVDs in the post. Making millions of dollars from the industry you are trying to kill off is an odd look for a tech giant — akin to Google running a telephone directory business or Facebook selling photo albums. Understandably, Netflix prefers to keep its legacy distribution business quiet. DVDs were hardly mentioned in the company's latest earnings report.

Pandemic boredom has given film discs an unexpected boost, with sales of US players up a quarter in April compared with the previous year, according to the NPD Group.

But this bump is unlikely to stop the terminal decline in demand. DVDs are popular in households with poor internet connection and movie geeks who say the image quality is better. But streaming is cheaper and more convenient. The Motion Picture Association of America reports global DVD sales fell from US$25 billion ($38.2b) in 2014 to US$10b last year.

At Netflix, streaming has long dwarfed DVD rentals, with 193m subscribers paying to access nonstop entertainment online. The only thing that stops Netflix killing off its old business is money. The unit made a contribution to profits of US$174 million last year.

A third of Americans never watch DVDs. That proportion is rising. As it does, expect Netflix to show fewer films. Rival platforms refuse to share content.

According to tech firm Soda the number of movies available on Netflix dropped from about 6,500 in 2014 to less than 3,900 last year. Multiple subscriptions are needed to access the same number of films. The end of DVDs could make it even more difficult to pick which film to watch.

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