Tuesday, November 6, 2012





The science fiction movie that I watched for the Module 4 assignment was Paycheck.  When I read the assignment, I did not even consider trying to locate a DVD.  We have a theater room with a Western Digital Media component.  That device allows us to pick up videos from several streaming video providers.  We also have a connection for our laptops to hook in to the projection system.  This allows us to pick up videos from Amazon streaming.  For this project, I purchased the streaming video for $2.99 from Amazon.  It instantly appeared on our projection screen.
This conversion from DVD to VOD is one that our family embraces completely.  Years ago, we had a massive collection of VHS tapes.  As that technology disappeared, it was obvious that our financial investment in VHS tapes was a mistake.  We dallied at creating a DVD collection during the early days emergence.  Although we converted to the new technology, we hesitated to make purchases and begin a collection.  With the appearance of VOD, that dilemma disappeared.  We are members of Amazon PRIME for purchases, and there are many videos that we can watch for free. Convenient service and the simplicity of digital storage make the VOD concept a superior one for our house.


This competition between DVD and VOD is an excellent example of increasing returns.  According to Arthur (1996), an emerging technology follows the process of increasing returns when the innovation moves ahead of the competition.  In a snowball effect, once ahead it continues to get farther ahead.   
VOD follows this explanation.  This system gained popularity with consumers due to advantages in delivery and storage.  As more consumers acquire rapid Internet connectivity, this advantage compounds.  The popularity of DVDs is in a decline as evidence by a reduction of DVD searching (Peoples, 2011) and reduction in DVD player sales (Daily Mail Reporter, 2010).


         The concept of red queens in emerging technologies comes from the Red Queen in “Alice in Wonderland”.  In this movie, the characters race and race to just stay in the same place.  For emerging technologies, this refers to two technologies moving ahead in fierce competition.  This does not fit the DVD and VOD market with the sequential timing of the technology.  The VOD market followed DVD’s and included additional dependence on Internet technology. 
         I believe DVD’s are working their way toward the obsolete quadrant of McLuhan’s tetrad.  Digital media resources will continue to overtake the DVD market.  VOD technology enhances video delivery by providing the consumer more control, easy storage and acquisition, and a reduction in cost.  Both technologies obsolete VHS and static television movie viewing.  Additionally, VOD obsoletes DVDs.  VOD’s eliminate the possibility of damage as noted in a broken, scratched, or damaged disk.  Although digital files can become corrupted, marketing systems can provide backups and product assurance.

References:

Arthur, W. (1996). Increasing Returns and the New World of Business. Harvard Business Review, 74(4), 100-109. 

Daily Mail Reporter (2010, May 5).  DVD player sales plummeting as film lovers switch to downloads.  Mail Online: Science and Tech.  Retrieved from: http://www.dailymail.co.uk/sciencetech/article-1270704/DVD-sales-decline-likely-die-internet-Digiboxes-over.html 

Krugman, P. (writer). (1999, August 19). 33000_33448_neubecker_lan (graphic).  Retrieved November 6, 2012 from:  http://www.slate.com/articles/business/the_dismal_science/1999/08/talking_about_a_revolution.html

Peoples, G. (2011, April 22). Google report on DVD’s decline not death. Billboard.biz.  Retrieved November 6, 2012 from:: http://www.billboard.biz/bbbiz/industry/tv-film/google-report-on-dvd-s-decline-not-death-1005150012.story

5 comments:

  1. This comment has been removed by the author.

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  2. You have a riveting post. Initially, I leaned toward DVD and VOD as an example of increasing returns. I changed my mind based on a broader perspective of many third world countries with low internet bandwidth. The streaming of videos could be cumbersome. For instance, I spent nine hours to download paycheck from Gabroid site, whereas it took others in developed countries 15 minutes. On this premise, the use of DVD is still on the increase, especially in rural areas. This implies that the competition exist at a global level. With this fierce competition, I concluded that it is an example of red queens. However, I noted that with time, VOD will obsolete DVD as internet connectivity improves globally, and the outcome will tend toward increasing returns as VOD oust DVD in the competition according to Thornburg (2008).

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  3. Aderonke,

    You are absolutely right. The difference in Internet bandwidth changes the analysis of the technology. Thanks for pointing that out.

    Jeri

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  4. Jeri,

    I am struck by how you use Amazon.com. The prices from Amazon.com very often make owning DVD's or downloading videos within the reach of most consumers. Here, however, I wonder how much of a difference exists between consumer-driven choice and institutional demands. How would institutional demands, e.g. higher educational class materials, corporate adoption for training, etc. correspond to the primarily consumer market? Does one outpace the other thereby not reflecting the Red Queen phenomenon?

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  5. Jeri,
    I also have a subscription to VOD which I am seriously thinking of getting rid of. I hardly have the time to watch videos, and my daughter is in love with her blu ray player. From the sources you cite it seems as though VOD is ahead in the competition and will eventually obsolete the DVD
    However I still expect that the DVD or video in tangible form will continue to exist for a long time since the continued diffusion of VOD will depend on certain factors. These include its availability in certain regions, and its affordability.

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