DVDs vs. VODs - Red Queens or Increasing Returns
- Aug 7, 2015
- 3 min read
Red Queens or Increasing Returns: DVDs versus video on demand
Red Queens according to Dr. Thornburg’s definition refers to two technologies that are in fierce competition with each other to gain an advantage by meeting new needs and becoming better (Thornburg, 2013). At the same time, increasing returns refer to a technology that is ahead of another technology, and the one that is ahead pushes further ahead to gain the advantage over the one that is behind because it loses further value or significance and can eventually become obsolete (Arthur, 1996, p. 100). The current competition between DVDs and video-on-demand is an example of Red Queens and increasing returns.
Red Queens: DVDs and video on demand
At the onset, the competition between DVD’s and video on demand could have been viewed as a good example of Red Queens. Video on demand entered the consumer market after DVDs but the competition to gain the advantage in the consumer market began almost immediately upon the emergence of video on demand. Both were in fierce competition with each other and DVD producers and video makers made several allowances that delayed when video on demand companies could release their videos while DVDs were released closer to the date releases were made in theaters (Mearian, 2014). Presently, there are still some movies that are not released to video on demand at the same time it is released to DVDs which gives DVDs a slight edge over video on demand. In an effort to meet the new needs of the consumer market, another version of DVDs called HD- DVDs emerged on the market. This added better video quality and larger capacity capabilities while competing with another disc format called Blu-ray. HD-DVDs and Blue-ray offered the consumer better quality pictures, easier access with distribution companies like “Redbox” -offering one dollar rental movies. These efforts boost DVD sales and fueled the DVD video on demand competition with DVDs holding steady in sales. These efforts also kept the competition on the Red Queens end of the continuum.
Increasing returns: DVDs and video on demand
Even though DVDs and video on demand entered the market at different times, there seems to
be a trend where video on demand is surpassing DVDs. This new trend can be labeled as increasing returns. The fierce competition between DVDs and video on demand is pushing the competition towards the increasing returns end of the continuum. Video on demand is pushing and gaining advantage over DVDs because many consumers are getting use to the idea of video on demand or electronic sell through – another type of video on demand -where consumers can purchase and store digital version of the movie to watch later (Lieberman, 2015). Also video on demand is pushing ahead of DVDs because consumers are finding this method more convenient, affordable, efficient, and accessible. These advantages push video on demand ahead of DVDs, but the progress is slow. However, it is estimated that video on demand or any online movie format is expected to grow 260% from $3.5 billion in 2014 to $12.7 billion in 2018 (Mearian, 2014).
Observations and Opinions
DVDs and video on demand is an example of Red Queens and increasing returns if we view the competition from different perspectives and at different vantage points in the competition. When I was asked to watch one of the movies for class I immediately sign onto Netflix. Unfortunately Netflix only had two of the seven movies on the list. I could get them on DVDs through Netflix if I so desired or rent DVDs from other companies. I was able however to access all movies on an internet streaming website that I could join as a member. Even though most of my movie watching is video on demand or some version of streaming, I still believe DVDs are far from becoming obsolete. DVDs like VHS will be an “after thought” in the near future, but DVDs will have a longer lifespan than VHS because DVDs still offer consumers quality and affordability especially since internet access maybe still limited in part of the United States and certain part of the world.
References
Arthur, W. B. (1996). Increasing returns and the new world of business. Harvard Business
Review, 74(4), 100−109. Retrieved from the Walden Library databases.
Thornburg, D. (2013d). Red queens, butterflies, and strange attractors: Imperfect lenses into
emergent technologies. Lake Barrington, IL: Thornburg Center for Space Exploration.
Lieberman, D. (2015). Home Video Sales Fell In 2014 As Disc Decline Outpaced Digital Growth
Retrieved from http://deadline.com/2015/01/home-entertainment-spending-fell-2014-deg-1201342148/
Mearian, L. (2014). Bye-bye, Blu-ray: Video-on-demand and streaming options are gaining on
you. Computer World. Retrieved from http://www.computerworld.com/article/2488931/data-center/bye-bye–blu-ray–video-on-demand-and-streaming-options-are-gaining-on-you.html
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