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Become remotely competitive on pricing

$6.99 to "rent" an HD movie vs $7.99 for a month's worth of HD movies from Netflix or the $2.49 I just spent for a 40-60 hour game. Pricing per hour of entertainment is way out of whack with the reality of the current market conditions.

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    JMJimmyJMJimmy shared this idea  ·   ·  Flag idea as inappropriate…  ·  Admin →
    GG shared a merged idea: XboxVideo needs new managment! Prices are WAY OFF!  ·   · 
    Kevin BerkheiserKevin Berkheiser shared a merged idea: Get competative on prices  ·   · 

    12 comments

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      • Anonymous commented  ·   ·  Flag as inappropriate

        Prices are a bit too high. Was in the supermarket the other day and blue ray "Edge of Tomorrow" was on sale for £12.99 vs Xbox video price of £14.99. I kinda expect the digital version to be cheaper...

      • Anonymous commented  ·   ·  Flag as inappropriate

        Absolutely agree. The pricing structure is terrible, hence nobody buys. They should do the following to make pricing simpler and far more attractive so people can build true digital libraries.

        - Cheaper rentals and purchases, NOBODY will buy at these prices
        - Allow us to rent a movie, thrn if we like it, we can simply pay the additional amount to own it. Example ; Rental is $1 and purchase is $3. I rented and loved the movie, so now I only pay $2 to own it.
        - Exclusive TV shows

      • NoelNoel commented  ·   ·  Flag as inappropriate

        Its more expensive to watch a streamed movie than it is to watch the same movie from Redbox $1.0, DirecTV is $5.99, Vudu $5.99, Xbox frankly I don't know because its more expensive. Its more expensive than Blockbuster used to be.

      • Patrick LeamanPatrick Leaman commented  ·   ·  Flag as inappropriate

        Everyone is looking at this wrong way they need to look at not from a monthly rental. Although that would be great and I do agree it would be helpful but need to look at this as the eventually progression of the future and microsoft is behind the ball once again when will microsoft stop playing catch up and start playing the intvaitor. I will offer microsoft the opportunity to contact and discuss with ideas that would advance their marketing strategies. I would sumize that I have idea for not only their products but their marketing as well that would once again put them on time. I however know that Microsoft is to aragont to do such so I will this comment in the slight hopes that they respond in advance of me getting to impatient.

      • Patrick LeamanPatrick Leaman commented  ·   ·  Flag as inappropriate

        Let give an example for why you need to be more price competive number if I can go to amazon which gives free videos plus allows me to watch it on more platforms and less restrictions why should I pay more money to watch it microsoft when it is platform exclusive not only has more restrictions on how to use on their website. So you want me to pay more for what reason. Plus amazon also allows you too add to que. It is also easier to share videos with amazon.

      • SteffenSteffen commented  ·   ·  Flag as inappropriate

        Couldn't agree more. Currently, for the price of one movie I could as well subscribe to Netflix or buy a DVD/Blueray...

      • JohnJohn commented  ·   ·  Flag as inappropriate

        The prices are outrageous for example how is there only a $1 difference from a episodes of south park in 1997 to one in 2013. Also is it where the older the episodes the cheaper it is so why is a season pass for season 5 of south park in SD cost $1.71 pre episode and one for season 4 in SD cost $1.76 pre episode.

      • CRC KenshinCRC Kenshin commented  ·   ·  Flag as inappropriate

        So I signed up for a free 30-day free trial on Netflix just to see what I'm not missing based on what I've purchased (not rented) through Xbox Video in the past year that are have been available for over a year (all of these titles are available for rent on Xbox Video, BTW). Night at the Museum 1 and 2, Pirate Radio, Harold and Kumar 1-3, Dark Skies, 28 Days Later, 28 Weeks later, Insidious, Pitch Perfect, The Goonies, NeverEnding Story, Knocked Up, Mama, Moneyball, Men in Black 1-3, Pineapple Express, Beerfest, Superbad, Chronicles of Riddick, 300, Amazing Spider-Man, Brave, Red, etc. The list goes on and on of what is not available on Netflix.
        The economics of digital movies are not the same as they are for those on physical media. Digital films are often released for purchase in advance of their disc-based versions. Rental options are turned on the same day as the disc-based release. The cost is higher to entice a purchase instead of a rental. Personally, because the cost difference is negligible and I'm trying to build up an extensive digital library, I prefer to purchase outright.
        Comparing the value per hour between games and movies (and even between games and games) is a laughable, straw-man argument. I could pull out my phone and download a free game that I could play for dozens of hours. Does that devalue money I spend elsewhere on an amazing game like Brothers: A Tale of Two Sons ($15 on XBLA), which can be beaten in under 3 hours? No, it doesn't. It's not a simple formula where Money Spent / Time Invested = Value. There are many factors at play that simple math (and you) ignore.
        Once again - I'm not arguing that rentals are priced perfectly on Xbox Video. As stated before, the competition shows that there is room to go down in pricing. However, a comparison to Netflix subscription or an inexpensive game you downloaded on your phone is hardly a realistic comparison to be basing your argument.

      • JMJimmyJMJimmy commented  ·   ·  Flag as inappropriate

        All those movies you listed, wait 90 days and they'll be on Netflix. The reality is that most of the movies are not a fixed fee/rental. Typically they're structured as a per copy cost ($2-10) to cover the cost of production of the VHS/DVD (not applicable here) + minimum fee per rental ($0.50-1.00) + a % of the fee charged (30-40%). This is/was the standard in the rental industry for decades via RentTrack. If you charged $2/rental the studio would get $1.16 and you would get $0.84. If you get your 43 million XBL customers renting 1 movie a week at that price that's 1.9 billion. I guarantee they're making more than $3/rental but I doubt they've got very high penetration in their 43mil customer base of prominently game oriented individuals. Those I know all laugh at the prices and go buy arcade games or DLC which give them a week or two of entertainment instead of 90 to 120 mins for the same price.

      • CRC KenshinCRC Kenshin commented  ·   ·  Flag as inappropriate

        Games and movies are 100% completely different industries from each other. As such, they have different business models with different expectations on how to turn a profit on their products. When you purchase a movie ticket to see a film in a theater, the vast majority of that ticket cost goes back to the studio. Because of that, small margin, theater operators are forced to charge ridiculous prices for food and drink to cover their overhead.

        In the case of rental services that are sanctioned by the movie studios (as any digital download service would have to be if it didn't want to be sued out of existence), rental costs are set by the studios. Redbox, Netflix (disc-based) and your local mom and pop rental shops operate (mostly) independent of studio influence and can set their own prices. Microsoft typically takes a 30% profit on app / game sales through their marketplaces, so they're probably making $2.10 per rental with the balance going to the studio.

        It's been a while since I was a Netflix subscriber. I dropped them because they didn't have any new releases available and I was spending an inordinate amount of money on rentals at my local video store to catch up on the latest releases that were out on disc for rent, but not on Netflix. So what you're telling me is that I would subscribe to Netflix right now and watch the top-rented movies from Xbox Video like Monsters University, The Conjuring, White House Down, Pacific Rim, The Heat, This is the End, World War Z, Star Trek: Into Darkness, R.I.P.D., The Great Gatsby (2013), and The Purge, etc.? They're simply not on Netflix for instant streaming. Trust me. The licensing fee is too high based on the movie studios expectations - not Microsoft, Apple, Amazon, Direct TV, etc.

        Like I said before, there's some room to move down in price looking at what the competition charges, but you'll never get the same selection that you get paying a la carte as you do when you're using a subscription service like Netflix or Hulu Plus. Current market conditions have nothing to do with it - your expectations are what is "way out of whack with the reality" of how the business operates. I'm not defending it - I'd love to pay less for movies - but that's just the way it is and you're (mostly) pointing the blame at the wrong party (Microsoft).

      • JMJimmyJMJimmy commented  ·   ·  Flag as inappropriate

        Movies and games now have similar development/marketing budgets but while games give you $0.33 to $1.50 per hour of entertainment of value, movies/TV are as high as $12.87 per hour of entertainment at those prices. The cost of delivery is tiny and if the licensing fee is most of that cost they need to negotiate better deals. These $5.99/$6.99 prices were based on being "competitive" with Blockbuster pricing which was set by the number of times a single DVD/Bluray could be rented vs the cost of the disc + operations of a box store. A typical disc was only rotating 7 times before it was sold at Blockbuster because they priced themselves so high. Stores which kept their prices low ($4) survived by buying fewer discs and rotating them 20+ times at a lower price. Digital doesn't have a per-copy cost, cost of delivery is in the 0.01 to 0.07 per GB range so their cost of delivery is in the sub $0.30 range (probably closer to $0.05). I'll wager their licensing fee is a maximum of 1/3rd of the rental price so that would mean they're making $4.49 per rental to cover their costs + profits.

        Redbox/Netflix and others are all competing in the same market for a lot less - sure some AAA movies get held back by publishers so they can eek out what they can but usually within 90 days of theatre release they find themselves on Netflix (at least in the US).

      • CRC KenshinCRC Kenshin commented  ·   ·  Flag as inappropriate

        There's a reason why Netflix is full of old catalog titles, documentaries and TV shows, but no new movie releases - they're expensive to license. Copyright holders want maximum dollars for their new releases. I'm not saying that the digital rental price couldn't be a dollar or two cheaper (renting new releases through my satellite provider $5.99), but it's not reasonable to compare this versus a Netflix subscription or attempt to justify the cost per hour with a video game. It's like complaining that a USDA prime steak at a Michelin star rated restaurant should be cheaper because you can get more food at Golden Corral for less money.

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