Good question. I actually don’t know and was trying to figure it out. I think there must be some nuance around owning the actual movie copy that makes it OK to sell to the viewer and then buy back. For example, I actually “rented” Star Wars the other night for $2, even though you can’t rent Star Wars ANYWHERE else (itunes, vudu, amazon, etc) because Disney restricts distribution. You have to buy it to own for $20 on iTunes or elsewhere. But on Vidangel, they’ll buy it back from you for $18 so your net cost is $2. That’s why I believe there may be future regulations placed specifically on SELLING BACK digital versions of movies, but for now it’s legal. In any case, I believe there is no reason a digital rental of a movie on iTunes (priced at $5.99 in many cases) should be so expensive, more expensive than DVD’s that Blockbuster used to rent out even while DVDs include physical materials (which add cost). So hopefully someone can figure out a business model (maybe Vidangel is it) to disrupt the implicit price collusion that appears to be happening between all the movie rental platforms.
Good point. I think “community” as it relates to content tagging is a bit of a loose term. I read something about them actually employing (or at least incentivizing) someone to tag most of the movies (someone who “would have watched the unedited versions anyway”), and the part that makes it legal is that you the viewer select what is included or excluded at the time you watch the movie. So although Vidangel is doing the tagging, it’s not actually doing the editing – you the viewer are.
Great article! I admit this world is a little outside of my expertise but I was impressed with the integration into Instagram and social media. This “Shop the Looks” on Instagram component could be very valuable for other industries besides fashion. For example, my wife follows interior designers on instagram and would love to be able to “shop the designs” that are posted, or to be able to offer the same functionality on her own designer instagram page. I follow ESPN on instagram and often see posts on the shoes that athletes are wearing – I’m sure Sterling would appreciate a “shop my kicks” link!
Great article! Amazon is incredible in its ability to handle fulfillment. It’s effective operations model has enabled it to grow to its current state.
I was not aware of the way it can undercut retailers. I wonder how this affects prospective retailers – are they aware of Amazon’s practice of undercutting them if their product is successful enough, and how many retailers does this dissuade from distributing through Amazon? To your point though, it provides an initial easy distribution channel for new retailers.
Great article! Tencent’s “launch-test-improve” innovation process reminded me of Valve’s method of developing video games, when it used open source methods to get input from gamers on its Half Life game. It seemed to work great for Valve as well.
I think this method of innovation is critical for a product like WeChat which is ubiquitous across China, and is used in so many different use cases. It seems that WeChat combines a lot of the individual mobile apps we use in the US (like Facebook, GroupMe, ecommerce apps, SnapChat, news, etc….). Such a ubiquitous and comprehensive product is likely a result of Tencent listening to its customers very closely and iterating based on their recommendations and usage history (when perhaps some of the US apps did not pursue the same type of operating model).