Saturday, September 10, 2005

Billion Dollar Idea

And I'm giving it away for free. Why? Because you'd need 500 million dollars to fund it, that's why.

It'd be a chain of stores that sold DVDs, like Suncoast; however, when you went in, there wouldn't be any physical DVDs. Instead, there'd be catalogs/displays/empty cases to browse through, filled with listings of movies and TV shows. When you knew what you wanted, you'd walk up to the counter, and tell the salesperson...

And they would connect to a (highly secure) server on a high-speed line, burn the DVD for you, print out a sleeve and slip it into a jewel case, and you would walk out with it.

Think about the huge advantages. No DVD would ever be out of print. Inventory management would be just a question of, "How many blank discs do we need to stock?" You could continue to reap profits on films that have been out for ages, because you wouldn't have to estimate demand. It's got all the bonuses of Print On Demand for the book industry, only it's quicker, easier, and it's what the public is already practically doing. Plus, you could allow people to select and add as many special features as they want ("that comes with the commentary track, would you like to add on a theatrical trailer and 'making of featurette'?") You'd have a lower overhead, and thus would be able to sell DVDs cheaper than any other chain in the industry.

Of course, there are issues. One, the "highly secure server". You'd need to make sure it was very, very, very highly secure. Securing the server and keeping it secure would, in fact, be your highest ongoing business expense. Two (and two is the reason I'm giving the idea away), you'd have to get at least one major studio to sell you the rights to its film library for use in this fashion (or lease, hire, rent, or whatever agreement you'd care to come to), and probably several if you wanted to have the kind of selection you'd need to have to compete with Suncoast and Best Buy. And the money you'd need to do that...well, I'd estimate nine figure sums, and probably a percentage of the profits as well.

But once you got the astronomical start-up costs out of the way, wow, would it be a money-maker.


Anonymous said...
This comment has been removed by a blog administrator.
John Seavey said...

Once again, I continue to ruthlessly delete spam disguised as blog comments. I'm sure there's a way to do this automatically, but I take a visceral pleasure in killing each post individually.

Tyson said...

I've been working my way backwards through your blog - good stuff! I don't know if you'll even see comments on old posts, but here goes:

1) Secure server - don't put it on the Internet. The connection between your database and the individual storefronts would be through direct leased lines. Expensive, but easy to make secure.

2) The deal you need with the content owners is this: we'll sell your DVD's for you, and we'll make 'em, too. You (the content owners) will get the same cut you do now when you sell a DVD, and you'll sell a lot more of them, because you can now make your entire library available. (They don't do that now because they don't want to print a bunch of copies of something that won't sell.)

The film and music industries are starting to see that DRM schemes do more harm than good, and actually encourage piracy. Once DRM is out of the way, direct-to-consumer sales over the Net are right behind - meaning this business model probably only has potential in the short term.