4 ms·

Renting of digital data is a stupid idea to begin with. I think that the millions of happy Netflix customers, including me, are going to respectfully disagree

Renting of digital data is a stupid idea to begin with. I think that the millions of happy Netflix customers, including me, are going to respectfully disagree with you on that one. I don't illegally download media, but I don't want to have to commit to purchasing every single show or movie that I watch.

shmerl 13y ago
What would change for you, if Netflix will change the terms from renting to buying? I think you confuse convenience of streaming service with benefits that renting of physical goods provide. Streaming service doesn't have to be equal to renting. See below.
- MartinCron 13y ago
  I guess I would expect the price to change. Netflix (as it is all streaming and not really "renting") isn't the greatest example. For some things that I can't stream on Netflix, I often rent from the iTunes store. The cost is much less than a purchase from the same store. The only difference is the understanding that the digital media I'm renting will no longer function after a well-understood period of time. I'm an adult, I can make informed consent to that arrangement. I wouldn't be happy with this being the only media option, but I like having that as one of the many options in the media ecosystem.
  - shmerl 13y ago
    I see no valid reason why the expected price should be higher in the case of a purchase for digital data. As was discussed here https://news.ycombinator.com/item?id=6496579 https://news.ycombinator.com/item?id=6496579 the main reason why rent price is lower for physical goods, is because it's based on reusability of the object. The reason to limit the time of using it is pretty straightforward as well - to allow the next user gain an access to the object. All these reasons have completely no application to digital goods. So what's the point in renting them, or making the purchase price any higher? I see none, except someone's potential greed may be. You can say, that renting an object more often produces more profit, in case when one time fee is charged for each renting, so that's the reason for the time limit. But then again, this is only valid when the resource is limited (physical object), and each user prevents others from renting it. In case of the digitial data which costs nothing to duplicate, the resource is unlimited, so this reason doesn't apply. And if we are talking about the same user renting it again and again, then what's the point? Purchase makes more sense again. The bottom line, I think that renting of digital goods is a pointless idea. And since as we see it causes DRM in result - it's a bad idea too.
    - MartinCron 13y ago
      Price of goods, especially digital goods, aren't based the cost of those goods. You don't expect to pay less for a low-budget indie film than a 300 million dollar blockbuster. The price of something is instead based exclusively on willingness to pay for it. The market has proven that people are willing to pay more for digital goods that they own and can consume over and over over digital goods that they have a short-term access to.
      - shmerl 13y ago
        Prices are based on cost at least in part. But with logic similar to yours, ISPs for example explain why they charge crazy prices for normal quality plans, and charge "normal" prices for junk ones. "Willingness to pay" when there aren't better alternatives is quite a slippery basis for any conclusions. Anyway, ask anyone if they prefer to buy and not to overpay, rather than rent. Just because someone devised an idea of renting digital goods for no reason except their own greed is not a reason to say that it's a good idea. It gives no benefits for the user and can be used as an excuse to drive prices up on purchases as you said yourself.
        MartinCron 13y ago
        Prices are based on cost at least in part. That's a fundamental misunderstanding of basic economics. The market always sets the price. If the price that is set by the market is lower than the cost to produce that item, then you just don't have a viable product to sell. The basic real-world reason that renting of digital media exists is because some people are willing to pay more for the added value of being able to watch it over and over while some people aren't.
        hackinthebochs 13y ago
        >The market always sets the price. This is rather devoid of meaning. What is the market if not a label we use to reference the extremely complex interactions of individuals with varying degrees of information and rationality in an adversarial system? Of course the actual price to produce a product influences what people are willing to pay for it! This is why companies fight so hard to keep that information secret. This is why I refuse to buy a typical cell phone plan that charges absurd amounts for data and text and stick to prepaid. I influence the market because of my knowledge of how much it actually costs to send a text. The market absolutely reacts to the actual costs of products.
- akjj 13y ago
  > What would change for you, if Netflix will change the terms from renting to buying? I don't subscribe to Netflix, but in my opinion if Netflix allowed downloading, what many people would do is make a list of movies they wanted to see, subscribe to Netflix for a month, download all the movies they could and then cancel. Then spend the next year or so watching the movies at over the course of a year or so. You don't get Netflix's recommendation features and everything's dated, but you could download many more movies in a month than you would want to watch. If people who were currently Netflix subscribers switched to this method, then Netflix would see its subscription rates drop. Since their costs would remain the same, they'd have to raise prices significantly. One of the advantages of Netflix is the low price, so many people would cancel outright, but first they'd want to build up a store of all the movies. Maybe some people would be willing to pay for a continuing subscription based on convenience, but I think that for the most part Netflix's user base would turn into one-month bulk downloaders.
  - nitrogen 13y ago
    Instead you subscribe to Netflix, wait a few months to watch what you wanted to watch, only to find it was taken down. Most subscribers would still subscribe to a DRM-free Netflix, because it's considerably easier than maintaining a failure-prone array of hard drives to store everything you want to watch.
  - gcb1 13y ago
    this is nonsense that is holding the industry. there are already copies with better quality than netflix available to everyone to download. and netflix is still in business. i still have to download those better copies in less than 2 hours when i want to watch something not on netflix or hulu. and i now hate it. i used to love when there were no convenient way to pay for it. so, quit the nonsense as it even goes against factual evidence
    - akjj 13y ago
      There are two separate issues: what is legal and what is possible. The downloadable copies you're referring to are certainly available, but downloading them is illegal. For many people, that makes a difference. The post I replied to specifically asked what would happen if Netflix changed its terms from renting to buying. I assumed that this meant that Netflix subscribers would be able to legally and conveniently download as many movies as they like during the period of their subscription. I continue to believe that such an option would lead to spiral of bulk downloading and Netflix price increases, but it's not an option that exists anywhere, so it's hard to say. Now, a different and more interesting question is what would happen if Netflix maintained the legal requirement to only view movies through streaming and not to store them, but eliminated the DRM. This would make their model comparable to Amazon's MP3 store, except with for video rentals rather music purchases. Netflix certainly think that such a model wouldn't work for them, and I'm willing to give them the benefit of the doubt. You can point to MP3 stores such as Amazon's to say it would work, but it's interesting that even though MP3 purchases are widely DRM-free, music streaming is still DRM-protected (as near as I can tell: correct me if I am wrong).

shmerl 13y ago

What would change for you, if Netflix will change the terms from renting to buying? I think you confuse convenience of streaming service with benefits that renting of physical goods provide. Streaming service doesn't have to be equal to renting. See below.

MartinCron 13y ago
I guess I would expect the price to change. Netflix (as it is all streaming and not really "renting") isn't the greatest example. For some things that I can't stream on Netflix, I often rent from the iTunes store. The cost is much less than a purchase from the same store. The only difference is the understanding that the digital media I'm renting will no longer function after a well-understood period of time. I'm an adult, I can make informed consent to that arrangement. I wouldn't be happy with this being the only media option, but I like having that as one of the many options in the media ecosystem.
- shmerl 13y ago
  I see no valid reason why the expected price should be higher in the case of a purchase for digital data. As was discussed here https://news.ycombinator.com/item?id=6496579 https://news.ycombinator.com/item?id=6496579 the main reason why rent price is lower for physical goods, is because it's based on reusability of the object. The reason to limit the time of using it is pretty straightforward as well - to allow the next user gain an access to the object. All these reasons have completely no application to digital goods. So what's the point in renting them, or making the purchase price any higher? I see none, except someone's potential greed may be. You can say, that renting an object more often produces more profit, in case when one time fee is charged for each renting, so that's the reason for the time limit. But then again, this is only valid when the resource is limited (physical object), and each user prevents others from renting it. In case of the digitial data which costs nothing to duplicate, the resource is unlimited, so this reason doesn't apply. And if we are talking about the same user renting it again and again, then what's the point? Purchase makes more sense again. The bottom line, I think that renting of digital goods is a pointless idea. And since as we see it causes DRM in result - it's a bad idea too.
  - MartinCron 13y ago
    Price of goods, especially digital goods, aren't based the cost of those goods. You don't expect to pay less for a low-budget indie film than a 300 million dollar blockbuster. The price of something is instead based exclusively on willingness to pay for it. The market has proven that people are willing to pay more for digital goods that they own and can consume over and over over digital goods that they have a short-term access to.
    - shmerl 13y ago
      Prices are based on cost at least in part. But with logic similar to yours, ISPs for example explain why they charge crazy prices for normal quality plans, and charge "normal" prices for junk ones. "Willingness to pay" when there aren't better alternatives is quite a slippery basis for any conclusions. Anyway, ask anyone if they prefer to buy and not to overpay, rather than rent. Just because someone devised an idea of renting digital goods for no reason except their own greed is not a reason to say that it's a good idea. It gives no benefits for the user and can be used as an excuse to drive prices up on purchases as you said yourself.
      - MartinCron 13y ago
        Prices are based on cost at least in part. That's a fundamental misunderstanding of basic economics. The market always sets the price. If the price that is set by the market is lower than the cost to produce that item, then you just don't have a viable product to sell. The basic real-world reason that renting of digital media exists is because some people are willing to pay more for the added value of being able to watch it over and over while some people aren't.
        hackinthebochs 13y ago
        >The market always sets the price. This is rather devoid of meaning. What is the market if not a label we use to reference the extremely complex interactions of individuals with varying degrees of information and rationality in an adversarial system? Of course the actual price to produce a product influences what people are willing to pay for it! This is why companies fight so hard to keep that information secret. This is why I refuse to buy a typical cell phone plan that charges absurd amounts for data and text and stick to prepaid. I influence the market because of my knowledge of how much it actually costs to send a text. The market absolutely reacts to the actual costs of products.
akjj 13y ago
> What would change for you, if Netflix will change the terms from renting to buying? I don't subscribe to Netflix, but in my opinion if Netflix allowed downloading, what many people would do is make a list of movies they wanted to see, subscribe to Netflix for a month, download all the movies they could and then cancel. Then spend the next year or so watching the movies at over the course of a year or so. You don't get Netflix's recommendation features and everything's dated, but you could download many more movies in a month than you would want to watch. If people who were currently Netflix subscribers switched to this method, then Netflix would see its subscription rates drop. Since their costs would remain the same, they'd have to raise prices significantly. One of the advantages of Netflix is the low price, so many people would cancel outright, but first they'd want to build up a store of all the movies. Maybe some people would be willing to pay for a continuing subscription based on convenience, but I think that for the most part Netflix's user base would turn into one-month bulk downloaders.
- nitrogen 13y ago
  Instead you subscribe to Netflix, wait a few months to watch what you wanted to watch, only to find it was taken down. Most subscribers would still subscribe to a DRM-free Netflix, because it's considerably easier than maintaining a failure-prone array of hard drives to store everything you want to watch.
- gcb1 13y ago
  this is nonsense that is holding the industry. there are already copies with better quality than netflix available to everyone to download. and netflix is still in business. i still have to download those better copies in less than 2 hours when i want to watch something not on netflix or hulu. and i now hate it. i used to love when there were no convenient way to pay for it. so, quit the nonsense as it even goes against factual evidence
  - akjj 13y ago
    There are two separate issues: what is legal and what is possible. The downloadable copies you're referring to are certainly available, but downloading them is illegal. For many people, that makes a difference. The post I replied to specifically asked what would happen if Netflix changed its terms from renting to buying. I assumed that this meant that Netflix subscribers would be able to legally and conveniently download as many movies as they like during the period of their subscription. I continue to believe that such an option would lead to spiral of bulk downloading and Netflix price increases, but it's not an option that exists anywhere, so it's hard to say. Now, a different and more interesting question is what would happen if Netflix maintained the legal requirement to only view movies through streaming and not to store them, but eliminated the DRM. This would make their model comparable to Amazon's MP3 store, except with for video rentals rather music purchases. Netflix certainly think that such a model wouldn't work for them, and I'm willing to give them the benefit of the doubt. You can point to MP3 stores such as Amazon's to say it would work, but it's interesting that even though MP3 purchases are widely DRM-free, music streaming is still DRM-protected (as near as I can tell: correct me if I am wrong).