What the studios giveth, Netflix taketh away

The long-awaited arrival of Netflix has turned mild interest in streaming video into something far bigger. But as video stores fall in Netflix's wake, it's worth considering what we have lost as well.

Nearly 15 years ago -- five years before the advent of YouTube -- I spoke with the local head of a video-store chain who envisioned a future in which customers would be able to sit at home, watching videos on demand that were piped to their TV via broadband services delivered in a sort of hub-and-spoke arrangement from each local video store. In telecom-speak, he was more or less envisioning the video chain becoming an ADSL reseller and subsidising the chain's wholesale costs with a regular subscription.

His vision was right on every point except one: Instead of empowering video stores as a sort of instant home-delivery service, current streaming-media services have completely bypassed them, leaving them to bleed on the shoulder of the information superhighway. The world simply no longer needs video stores ... right?

With the recent introduction of Netflix, Stan, Foxtel Play, and Presto, streaming media is no longer the go-to mechanism for people too lazy to drive to the corner shop and hope there were enough copies available. Instead, it has -- for better or worse -- become the only choice for anybody wanting to watch videos on demand.

Video Store No More
The likely state of your local video store (Image: David Braue)

When I say "only", I may be stretching things a bit. There are still some video stores in operation, just like there are still some Starbucks stores in Australia. But they are not long for this world, so to speak.

Many will dismiss the death of the video store as an inevitable mark of progress, but there are losses. Even the behemoth Netflix, with its considerable selection of movies and TV shows, only shows a finite number of titles limited by its own licensing agreements. This means that while Netflix can always give you something to watch, it will frequently be unable to give you the thing you want to watch.

Numerous sites dedicated to tracing the ebb and flow of Netflix titles document the difficult situation in which we find ourselves. Those wanting to watch Life Is Beautiful, the 1987 version of Robocop, The Princess Diaries 2, Skyfall, or the 2012 version of Red Dawn are, or soon will be, out of luck.

Online, there are no out-of-the-way Weekly Rentals sections filled with old movies on scratched discs stored in sun-faded rental cases. In the video-on-demand parlance, those titles simply do not exist. Good luck trying, as I recently did, to find and watch Butch Cassidy and the Sundance Kid, Citizen Kane, or even Blade Runner after they come up in dinner-table conversation.

Sure, streaming-media services have given us choice -- but they have also taken it away from us. Movies are regularly added to online services, but they are also regularly taken away due to the vagaries of studio-driven licensing contracts.

The upshot is that while streaming services offer great value and convenience, they only let us watch what the services want us to watch -- with a strong skew towards contemporary titles and the inevitable marketing tie-ins as growing subscriber numbers bring advertisers in droves.

For those wanting titles that aren't available through streaming-media services, the death of the local video store means viewers will either have to go to a local library, subscribe to the ill-fated QuickFlix DVD-rental service, or download the movies from pirate sites.

Those wondering why Game of Thrones piracy continues in Australia must consider the role of telecommunications in both facilitating and hindering these services. US-based HBO may have chased its megabucks exclusivity deal with Foxtel, but what it did not consider is that it sold exclusive dominion over the show to a pay-TV operator that only owns physical cable to one in five Australian homes.

For the other four, piracy has been the only way to watch the show. And while streaming-media services will pick up the show after its first-run exclusivity on Foxtel, customers in poor broadband areas -- and there are many of them -- will still find themselves unable to stream the show at an acceptable quality.

Downloading the entire episode at once, then watching it from local storage, will be the only way of experiencing the show in anything resembling watchability. Heck, it wasn't too long ago that I had to chase a refund from Telstra because the on-demand movie service it delivered to my TV was unable to effectively stream an HD movie that I'd paid for -- over an 18Mbps cable service.

Quality of broadband is not, as any actual broadband user knows but policy-spouting bureaucrats seem to ignore, a guarantee of good service.

The real quality of the online experience is as much related to the upload speeds on the other side of the connection as it is to the download side of yours. And, as streaming video puts previously unimaginable pressures on our broadband infrastructure -- overall internet volumes are up 15 percent or more since the local introduction of Netflix -- it will not only restructure Australia's telecommunications market, but will also force a reassessment of long-term broadband policy. And that policy, sadly enough for those who love movies that were made more than three years ago, is likely to limit your selection as it slowly paves the way for studios to once again control what we watch, and when.

What do you think? Were video stores just waiting to be put down? Do they still have a place in a Netflix world? Or can the wonders of telecommunications eventually replace them with equivalent services?