Tuesday, June 5, 2007

Video on Demand Trade; Death of DVD

Video on Demand Plays

CNBC's show Fast Money on June 5, 2007, featured a segment on playing the Video-on-Demand trend in the Digital Living Room. They started the segment saying that when DVDs come out, movie studios will send the movies direct to Video-On-Demand Systems as well.

1. Jeff Macke one of the traders suggests:
Releasing DVD and VOD (Video on Demand at the same time) helps the studios capture more of the margin. The rental business isn't that great for the studios. So the trade becomes: Long Disney (DIS) or any movie studio. Also, good plays are Comcast (CMCSA) because VOD is good for them. Companies like Blockbluster (BBI) and Netflix (NFLX) will get killed by this.

2. Eric Bolling:
Short BBI. Winner is Comcast (CMCSA) and other Content Distributors.

3. Guy Adami:
Long Lions Gate (LGF)


Joost Plays

Joost and internet video on Fast Money: There is a trend towards peer-to-peer model vs. a central server model (like YouTube). With the peer-to-peer model (from big players), downloads can be faster and legal. Get content direct from a CBS (CBS), Time Warner (TWX), or Viacom (VIA) or some other big player. There is also an advertising aspect, as Joost might be able to use this information to do targeted (more effective) ads.

Associated with this company are two publicly traded companies, CBS, and Viacom (VIA). One of the reporters speculates that it might be a good takeover target for one of the media players.

1. Eric Bolling:
Doesn't like it because it is not user generated. There are too many ways to get non user generated videos.

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