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Digital Distribution and the Death of Physical Media

How music, movies, books, and games are being delivered online.
by

Jake Curran

on 1 November 2012

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Transcript of Digital Distribution and the Death of Physical Media

- Music was the first form of media to take advantage of the great possibilities within the realm of digital distribution

- Napster was first to the market, but was originally a peer-to-peer file sharing service which lead to legal troubles

- Then came Apple with the iPod and iTunes in 2001 which promoted people to pay for their music rather than pirate it

- Today their are many services or ways to legally obtain music online Music iTunes - The reigning champ

- Over 225 million accounts with credit cards

- Despite it's great success due to the iPods, iPhones, and iPads, the app is extremely outdated and a horrible, slow experience, only started selling DRM free music recently - iTunes 11 announced last week featuring a new design that resembles the recent Metro UI trend as seen in Windows 8, Cover Flow is also gone

- Only upon release in October will it be known if it is any faster

- Much better options, even if you have an Apple device Amazon MP3 - Launched in January 2008 and was the first music store to sell music without DRM

- Allows people to buy music in the already familiar to most Amazon store and play it on any device; web browser, Android, iOS - Not only can you access the music anywhere by signing into your Amazon account, but you can download the MP3 files without DRM

- Great service if you are already in the Amazon ecosystem; books, movies, regular store Google Music - Originally launched in November 2011 and later merged with Google's store re branding, Google Play, in March 2012

- Is very different than other music stores as it allows you upload your current music collection, up to 20000 songs, and access them anywhere (Android, iOS, any web browser) - The store has many free songs as well as many songs for purchase

- Best option if already in the massive Google ecosystem; Android, Drive, etc.

- Unfortunately not available in Canada at the moment, but there is a workaround using a VPN service such as TunnelBear Spotify - Launched in 2008, Spotify is a Swedish music streaming service providing both free and paid plans

- Currently has over 15 million users and 4 million of them paying monthly

- Upon registering, users are given a free six
month trial in which they may stream an
unlimited amount of music which is supported
by radio-like ads as well as links to buy the current song at their partner's sites - Packages are available for 10 or 15 dollars a month that allow for unlimited streaming, no ads, higher bit rate music, and the ability to listen on mobile devices

- Is currently available in most European countries and the US, rumored to come to Canada soon Video - The digital distribution of movies and TV shows has only gone mainstream recently

- This is primarily due to bandwidth, or the lack of it

- There are now many competitors in the game offering very different services

- More and more people are choosing to stream their movies and shows rather than getting a physical copy Digital iTunes - Also a big name in movies

- Allow for one to rent or purchase or rent a movie and view it on their PC, iPod, iPhone, iPad or Apple TV

- Their greatest advantage is the ecosystem of Apple products that allows you to watch and resume it on any device Digital Distribution and the Death of Physical Media Jake Curran - Still differentiate normal quality (720p) from HD (1080p); 5 dollar price difference when buying movie and one dollar difference when renting

- Renting a single movie is 5 or 6 dollars, not much value when compared to other services - Amazon offers a similar service to iTunes in which users may buy or rent movies

- Prices are quite cheaper; $15 to buy and $3.99 to rent

- May stream the movie or show from any web browser of mobile device, or even download a copy to watch anywhere Amazon - Amazon also offers a service titled Amazon Prime which is $80 dollars a year and includes Prime instant video; similar to Netflix, free 2 day shipping, exclusive offers and a free Kindle book rental every month

- Is not available in Canada currently, Amazon is quite bad at rolling things out internationally, but is in the US Google Play - Similar to Apple, Google offers movies and TV shows through Google Play; accessible from any web browser or Android device

- Rental prices ranges from 1.99 - 4.99, purchasing prices are competitive - Great service if already in the Google ecosystem; Android, Nexus, Google account Netflix - The reigning champ in streaming

- Was founded in 1997 and began distributing content digitally in 1999

- Also have a quickly fading a way DVD service - For eight dollars a month, users are given unlimited access to the Netflix movie and TV show library

- Netflix is accessible from any web browser or mobile device

- Is widely available, but the library is limiting when compared to the US counterpart Books - The digital distribution of books is also nothing new and has been around for a while

- This category of digital distribution is especially important as physical books have been around forever, and the sudden change to digital is not for everybody

- A huge market and especially important in education - Amazon is still number one in e-book sales, but many competitors have appeared including Apple, Google and Sony Kindle - The first kindle was released in 2007 and the product has been successful since

- Although Apple and Google are now competitors, Amazon remains the main company providing devices solely for reading; can read outside in the sun, less straining on the eyes

- Amazon allows users to purchase the e-books online or from the device and access it on the web or any kindle device logged in to that Amazon account - Amazon now has many different Kindle devices; Paper White, Fire HD, DX and the default Kindle

- Further value is added when a Prime subscription is activated; free book every month - Largest issue with e-books is the price when compared to their physical counterparts Apple - Apple entered the e-book market in 2010 upon the release of the iPad

- When a book is purchased, it it linked to your account allowing you to read it on any iOS device, but cannot read it from a computer - Different from Amazon, Apple went with a highly skeuomorphic design; wooden bookshelf, Apple has done many skeuomorphic designs including such materials as cheap stitched leather and they all look terrible

- Once you buy the books, they are locked in Apple's limited ecosystem Google Play - Google also offers books through Play

- Just like all other Play content; it is synced across devices and allows reading the book on the web as well

- Great if in Google ecosystem as always - Is a very limited service as it is the newest one to the market Steam - Valve first released Steam in 2003, launching with in-house titles such as Half-Life, Counter Strike, and Team Fortress Classic

- By 2005, Steam had games from other developers and publishers which made the platform extremely profitable for Valve - Steam as of 2009 was estimated to have a 70 percent share on the digital distribution of video games

- PC gamers praise Valve for Steam along with Valve games such as Portal, Counter Strike, Half-Life, Team Fortress 2, Dota, L4D etc Steam - Steam is the one place for PC gamers to buy their games, play them, and socialize with the community - Steam simplifies the process of buying games online; automatic updates, no need for CD keys

- Steam has seen competitors such as EA with Origin, but Steam continues to develop and expand the Steam platform with features such as Big Picture mode that make it the platform to beat Value - Digital vs Physical - The great deciding factor in whether someone will buy digital or physical is the value provided; it is up to the media providers to provide more value than the physical version and vice versa

- Some industries are doing this better than others; Steam does this exceptionally well as if you buy a physical copy rather than buying it through Steam, you lose all the advantages that Steam provides including the community and one library

- The e-book industry is not doing this nearly as well as others as it is often no more expensive to get a physical copy; which the vast majority of people still see more value in
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