Prometheus and The Continued Challenege of Digital Movie Sales

This month The New York Times reported that Fox has started to experiment with windowing in order to try and drive EST (electronic sell through, aka download-to-own) revenues. Specifically, they launched Ridley Scott's sci-fi thriller PROMETHEUS for digital purchase three weeks before the October 9 DVD/VOD street date for a reduced $14.99 HD price (standard HD pricing on studio fare is $19.99). It's no secret that digital sales are struggling to make up for the steady erosion of physical media sales (translation: DVD is going the way of the CD). Why folks are not prone to buy movies digitally is up for debate but a few of the discussed reasons are as follows: (1) Price: $20 may be too much for a file that takes a long time to download (these things can be up to 5G) and is locked into a certain ecosystem. (2) Perceived Value: while iTunes extras (a desktop only version of DVD extras) and other such forms of digital bonus content are gaining traction, consumers are still not getting much more than a big, heavy file.  And as it's hard to display the digital movies you've bought at home, the self-expressive benefits of movie ownership may die with physical media. (3) Windowing: maybe people don't want to buy the file because they don't have to. If you're only going to watch the movie once or twice, VOD/digital rental is the more sensible option and currently the VOD/EST windows are one and the same.  Simply put- why buy when you can rent?

The PROMETHEUS release addresses (1) and (3) and thus far the results look pretty good. Despite only being available for purchase, the movie is currently #3 in iTunes.