Report: iTunes No. 3 Provider of U.S. Digital Video Subscriptions

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Dejavue All Over Again. Microsoft and RIM plan to launch iTunes rivals.
Dejavue All Over Again. Microsoft and RIM plan to launch iTunes rivals.

When it comes to attracting consumers to video subscription services, convenience wins out over other factors. That’s the message behind new research finding Netflix gets 60 percent of the U.S. digital subscription market, leaving Apple’s iTunes No. 3, with just 4 percent. Cable giant Comcast placed second, according to a NPD Group report on domestic digital video demand between January and February 2011.

The iTunes service tied with satellite provider DirecTV and entertainment behemoth Time Warner. Although the Apple service began in 2006, iTunes began renting movies in 2008 and 99-cent TV episodes in 2010. Despite consumers knowing iTunes had a more up-to-date inventory for rent, Netflix was given the nod due to the “overall shopping experience” and “value for price paid,” NPD announced Tuesday.


Ironically, the Apple TV device is just one of the devices Netflix uses to stream movies and TV episodes to subscribers. Netflix, once known for its subscription-by-mail service, is now rapidly expanding on its streaming-video Instant Watch feature, allowing subscribers to watch content on their TV, laptop or game console, among other devices. If Apple is judged solely on video sales, it leads the market with 64.5 percent, according to a February study.

Video streaming now comprises a quarter of all home video activities, according to the researchers. The prime reasons given include “immediate access” and “ease of acquisition.” Even so, consumers have not written off the DVD as a delivery method.

[AppleInsider]

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