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> Disney could (should) be most profitable when they make access to their product (content) easier.

Ok I'll bite. Access to content has multiple facets:

First main point is price. Obviously it's not "most profitable" for Disney to make it's stuff free. A subscription service is going to charge a monthly fee and that fee is going to be primarily licensing and overhead. Dividing that over a dozen companies reduces the profit taking of a market leader like Netflix but also multiplies the overhead. Note, the 3 year contracts already control Netflix from taking too much of the profits so it seems like there is little incentive for Disney to want a market of say 10 netflixes over one.

Second main point is that not all access is equal. Disney has strong incentives to associate its content with: (1) a quality service both in delivery and interface; (2) a service that provides useful data back to Disney; (3) a service that will promote Disney. Why should Disney associate itself with your fly by night terribly performing service that streams in 360p, constantly drops and has a 15 step sign up process riddled with malware carrying flash ads? Why should Disney help me launch a foreign film centric service where Disney movies are also rans?




> Obviously it's not "most profitable" for Disney to make it's stuff free.

Granted. "Easier to access" in this case in analogous to a manufacturer selling their wares in more stores, instead of limiting sale to a handful of select retailers. Of course the literal interpretation of "easier to access" means that everyone finds a copy of the latest Disney content mailed to their doorstep with no expense to the consumer.

To your second point, assuming the marginal cost of distributing content through 3rd string distributors is negligible, why shouldn't Disney want their content distributed through anybody who will pay? My assumption is that all things being equal the market will abandon those providers. On the other hand, if Disney decides to go exclusively through a provider like Netflix, consumers don't have the option to move their business elsewhere.

(Obviously a site that installs malware would and should be shunned by Disney, just as a retail store that steals credit card numbers might be black listed. These are ethically and legally wrong.)

I agree that Disney has tremendous incentive to do things they way they do. In my personal utopia, they would be incentivized to behave as I described in the parent thread. The question remains: how should the market and industry shift to get us to that point?

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