Twice I have blogged about my enthusiasm for a product I own and have followed since its inception, (vudu demo blog, vudu initial reaction). To recap, Vudu is a small box that you plug into the internet (or wireless bridge) that allows you to play thousands of movies instantly. I am a strong believer in this Bay Area startup as the technology, usability, and concept behind Vudu all point to a successful IPO and subsequent adoption by the mainstream market. My only qualm about the company was its ability to execute and cultivate a solid business plan where market education and product differentiation would be a constant challenge. Business Week actually tackled this issue a month ago with its cover story, I want My itv
Although Vudu has only been on the market for less than 60 days, I have been pleasantly surprised with their fast start out of the gate. A couple weeks back Vudu rolled out the first series of HD releases, with promises of more to come. With HD titles now available, Vudu is now being mentioned along with Blu Ray and HD Dvd in press releases and articles announcing upcoming releases of new movies. With so much uncertainty surrounding the HD format war , consumers may now opt to go with Vudu rather than rolling the dice on a potential next gen loser (HD DVD).
While I have raved about the convenience, user interface, and ease of use of Vudu, I quickly grew skeptical of the offerings Vudu had initially thinking Vudu would live up to the hype of a Blockbuster in a box. I thought that if the Itunes store was able to resell television shows, then why not Vudu? Surely this was on Vudu’s road map but these types of distribution deals take time and the networks would need to wined, dined, and most importantly convinced that Vudu was a long term viable product and platform.
Surprisingly Vudu has already signed a distribution deal with 20th Century Fox, a mere 2 months after product launch. Vudu already had a deal with Fox for movies, but it was my belief that the network television would take a wait and see approach before adding television episodes to the mix. Sometime early in 2008 shows with cult audiences like 24, Prison Break, and Family Guy will now be available to be purchased at $1.99 per episode. One would surmise other networks will join the party seeing a new revenue stream, but more importantly a increasingly popular media platform of the future.
Other news to report on the Vudu front, is more traction with distributors as initially Vudu was only sold on their website. However a quick look at Vudu’s reseller page boasts a very modest reseller network for such a young company with the likes of Magnolia, Tweeter, Sound Advice, Hifi Buys, and Myer Emco. Although the electronic giants such as Best Buy and Circuit City have yet to reach an agreement, its pretty clear that retailers like what they are seeing from the young company and believe their is a viable market to sell to.
Another encouraging sign can be found in the coming soon area of the Vudu box interface. Initially Vudu was batting around .600 or so when new releases would come out. It seems now that the studios are seeing positive signs of Vudu’s adoption and are releasing a larger percentage of movies onto the young platform. The Simpsons, Once, Superbad, Die Hard, and Spiderman 3 are some of the many popular movies that are simultaneously being released on Vudu concurrently with their DVD release.
With a good collection of new releases and old classics, Vudu only sore spot is box set collections and a good chunk of the nineties classics I grew up with (Jerry Mcguire, Forrest Gump, Shawshank, Goodwill Hunting, Tarentino, Coen Brothers, etc). Vudu made a huge marketing splash with the Bourne Series being available in HD ( the first two were free!) so its very plausible that studious are pushing for similar marketing efforts around releasing series like Indiana Jones, Star Wars, Lord of the Rings, Batman, Rocky, etc, and will release those titles once an agreed upon marketing push is finalized.
Another hiccup with Vudu, lies with movies availability for purchase only or for rent only. New releases are typically only available for purchase for the first couple of weeks before becoming available for rent. Many Vudu owners are hesitant to purchase a movie instead of renting knowing if the box breaks or Vudu goes out of business, its possible their purchase will have been in vain. Luckily Vudu keeps a purchase history for each owner and will preload all purchased movies onto a new box should your box break. Still its an unnecessary drawback to a system I absolutely adore. Only time will tell if they will address this.
So with all this general analysis, how is Vudu fairing in my household? I use the box about 3x a month with my roommates using it about once a month. I have watched or rented Knocked up, Tootsie, Muholland Drive (wtf?), A player to be Named Later (great sports documentary), Who Killed the Electric Car, and Oceans 13. If I didn’t have Vudu I would likely have not watched the majority of these flicks which really validates the need and demand for such a product.
While I love the system, I am still opposed to purchasing a new release at $20, rather than purchasing the DVD or Blu Ray as its a hard copy that I will be able to hold onto and transport more easily in addition to the added extras. I have purchased movies on Vudu but strictly for convenience purposes thus far
In closing, Vudu is on the right track and are growing faster than I anticipated. More movies, more shows, and more retailers are on the horizon which will bode well for the young company. Things are shaping up nicely for Vudu who I believe will likely make a big marketing push for the product for the 2008 holiday season when their brand, product, and title selection is more mature.
Vudu is not perfect with some obvious favorites missing and others only available for purchase only. Regardless the progress Vudu has made since shipping its product is remarkable as the proliferation of new releases, HD movies, and television shows has quickly raised the value and future outlook of this industry changing product.
