With Moset Baer announcing 500 Crore Rupees investment plan to foray into digtal entertainment and distribution business. Its sounds big trouble for Pirated Movies retailers and offcourse our favourite topic of discussion on this blog Online DVD rental companies.
As we have seen most of the DVD companies offering rental with average movie rent out price of INR 50 with INR 38 they have surely send the business managers back to drawing board. As price economics dont support them anymore. Important aspect will be retailing of the DVD’s. If these INR 38 DVD are not easily available in market then whole concept will again tilt in favor of rental companies. Rental companies profit margin also improve with low cost of DVD as compared o existing Movie DVD costing somewhere between 300-400 INR. But substantial cash flow does get effected.
Another point in favor of online DVD Rental companies is the collection as it will be interesting to see how many movie rights can Moser Baer wrestle as license regime in indian film industry is based on old friendship and loyalty. But Moser baer will also be competiting with other Digital Rights Management companies espically those ones backed by people from film industry owning the content.