DVD or Not DVD? That is the Question.

Todd Chanko | January 17, 2007, 03:19 PM

Cognitive dissonance, anyone? Within a span of two days, twinned announcements underscore competing visions of the delivery of video content. Yesterday Netflix announced it would begin offering a limited selection of titles for streaming to subscribers’ PCs. Reed Hastings, the clever entrepreneur behind Netflix, has long argued that physical delivery of DVDs was but a way station to his ultimate goal – broadband delivery. Today, however, CBS announced that it was carving out a separate business unit devoted to the sale of DVDs: CBS Home Entertainment. The new division is charged with distributing both the CBS and Showtime libraries, respectively. More intriguingly, CBS aims to boost its DVD release sked by 20 percent this year.

Now many a pundit has predicted the demise of physical media and the ultimate dominance of the purely digital. True, there is no arguing against the raw data that suggests that DVD sales have slowed considerably in the past two to three years. Yet, even in the age of iTunes, iPods and now iPhones, at least one major media company is not yet abandoning physical goods. Ironically – or perhaps not so much – it is this same company that launched its well-intentioned Innertube last year and announced a beta test with Sling at CES earlier this month. Yet, let us not forget that CBS is a broadcast network – and that good old rabbit ears can still pull down its signal. Traditional delivery still apparently has its place in the media firmament – 92% of online consumers regularly watch movies & TV shows on a TV.