The online video sharing and now movie retailing startup Guba has been experimenting with its prices for the past week, trying to work exactly what will encourage people to pay for online TV and film. Traffic has increased 500 percent since, erm, it cut prices down to $0.99 for movies films and $0.49 for TV episodes. “Nobody knows what the right price is for this stuff online. The studios don’t know – even Apple doesn’t know.” Imagine that! Apple not knowing something. Perish the thought.
CEO Tom McInerney appears to be banking on this bargain basement approach to win over more studio deals – it recently signed a couple with Warner and Sony: “Frankly [the studios] are looking for the data themselves. This is something we’ll bring back to the studios, and we can sort of work out the right model.”
The Motion Picture Association of America estimated the movie/TV download market at $50 billion, but at under a dollar per unit a juicy share of that must seem a long way off for Guba. How will they can monetize the user content they mix in there? That’s the interesting part.
Rafat adds: This is either a desperation move of trying to drum up interest, or a strategic one fending off Apple’s imminent entry into the market. Or mixture of both.
Note: Those under-a-dollar rates are for watching movies and TV episodes online. Movies to buy on DVD are upwards of $4.99, depending how recent the film is, etc…
— Video Hype: Yahoo’s Lame New Show; Guba’s Sony Movies; BitTorrent’s Indies; User-Gen No Go
— Hollywood Recasts Its Download Allies
This article originally appeared in MediaGuardian.