Hoping to make Netflix (Nasdaq: NFLX) disappear like its graphically notorious "pencil trick" sequence, Time Warner's (NYSE: TWX) The Dark Knight is breaking new ground in digital delivery.
Chris Nolan's high-grossing installment in the Batman series is being offered as an online rental through its Facebook page.
It's a brilliant tactic on the surface. Time Warner is charging the Facebook Credits equivalent of $3 for the 48-hour digital rental. That's a bargain compared to most a la carte digital rentals for new releases in the $4 to $5 range. It's also pushing the offering on the flick's "Like" page on Facebook with nearly 4 million fans.
Unfortunately, there are more than a few holes in this strategy.
- The Dark Knight was the box office champ of 2008, but that was three years ago.
- Facebook's page is a great hub of the film's biggest fans, but these are also the same people who likely already own the movie.
- Unlike most digital rentals that can be streamed through a wide range of devices, this $3 offering can only be streamed on a computer within its Facebook app.
The initial fan comments aren't very inspiring. Some are wondering why they would fork over $3 to watch a movie that they already own on DVD or Blu-ray. Some more nefarious types are scoffing at the $3 price tag when it's available in pirated form for "free" in cyberspace.
This isn't going to be a hit, at least not in its present form.
Wanna know how I got these scars?
"Madness, as you know, is like gravity," The Joker says in the movie. "All it takes is a little push!"
Warner's missing the point with this stunt. It could have gone the free route for a limited time to really draw a crowd. It's done that before. It actually teamed up with Netflix to stream The Wizard of Oz to non-subscribers for free two years ago, in anticipation of the iconic film's special edition Blu-ray release.
Warner has an uphill battle in getting folks to pay to stream a 3-year-old movie on their computer, though.
Netflix streaming got off to a slow start in 2007 because it was limited to PCs -- and Windows PCs at that. It wasn't until it got couch potatoes involved by striking distribution deals through TiVo (Nasdaq: TIVO) and all three video game consoles that it truly took off.
I'm not arguing that Time Warner should have brokered wider distribution for this offering. It would be reinventing the wheel. Amazon.com (Nasdaq: AMZN) offers this same 48-hour rental -- across a wide range of home-theater-tethered devices -- for just $2.99.
How about a magic trick?
Warner's biggest failure is that it's trying to push a Web 1.0 concept on a Web 2.0 platform.
Who is going to pay to passively stare at a monitor for 152 minutes?
I recently offered a glimpse on what Netflix may look like come 2014 and found that one of Netflix's biggest threats in three years will be Facebook's Community Theater.
If you've never heard of FCB, I understand. I made it up! I was trying to convey a social streaming experience. Imagine getting a group of Facebook friends together to simultaneously stream a flick on the site. The movie takes up most of the screen, but a chat sidebar offers the opportunity to exchange text chats. Now picture that same scene with a larger Facebook audience and set streaming start times as a second viewing option.
Wait! Nobody wants to be in a noisy theater? Absolutely. I hear you. Spoilers will fly. Trolls will engage. Distractions will take away from the action on the screen. However, for a movie like this one where it will be a repeat viewing for nearly anyone, wouldn't the engaging social element be something worth paying for? Wouldn't it be something that a sponsor would consider subsidizing?
If someone doesn't want to hang with like-minded fans, discover things about certain scenes or bit-part actors, or share interpretations, a single click makes it a full-screen viewing experience.
Why so serious?
Digital rentals have been a bust so far. Google's (Nasdaq: GOOG) YouTube tried to push premium rentals but that was a flop. Blockbuster, Amazon.com, and Apple (Nasdaq: AAPL) sell piecemeal streams. These are typically chatty companies, so their reluctance to divulge actual premium rental metrics is telling. Why else did Amazon recently follow Netflix into the unlimited streams model?
If dot-com darlings and studios want to get consumers to crack open their wallets for streams, they are going to have to make it more social.
"You either die a hero or live long enough to see yourself become the villain," Batman says in the movie.
If premium rentals get through this -- and learn the social tricks of the trade -- they may one day grow into becoming a welcome adversary for Netflix.
What is Netflix's biggest threat these days? Share your thoughts in the comment box below.
