The Cost Of Permission Culture: Or Why Netflix Streaming Library Sucks Compared To Its DVD Library

from the first-sale-is-important dept

Why can't movie-streaming sites deliver the selection of movies that customers obviously want?  This was the question posed by a recent New York Times column, comparing undersupplied services like Netflix with unauthorized platforms like Popcorn Time.  The answer, the Times explains, is windowing—the industry practice of selling exclusivity periods to certain markets and platforms, with the result of staggered launches. 

But the Times fails to ask a more fundamental question: why do streaming sites have to listen to Hollywood's windowing demands in the first place?  After all, while it's clear why the studios like windowing—they can sell the same rights over and over once the promised exclusivity periods expire—it doesn't seem like a very good deal for users.  Those users get access to a smaller selection, higher prices, and fewer choices between platforms and services.  It should be astonishing that a company that once had to maintain and transport a staggering inventory of fragile plastic discs is able to offer less when its marginal cost dropped to near zero. 

The problem is that, unlike earlier movie-rental options, streaming rights fall fundamentally within a permission culture.  Netflix is a great illustration of what's gone wrong here.  It's gone from having a nearly unrivaled catalog of films available to rent to being the butt of Onion jokes.  What happened: It shifted from a system where nobody had a veto power over its operations, to one where it had to get permission and make deals with Hollywood.  Sometimes it's difficult to find the concrete costs of living in a permission culture, but the decline of Netflix's selection is an important cautionary tale. 

It's especially clear when you look at how Netflix upended the movie rental market in the first place.  In one way, it suffered from a major competitive disadvantage: competitors like Blockbuster had locations near people's houses.  As long as those stores had the movie you wanted, you could be watching within hours—not days—of deciding on a title. 

But Netflix was able to experiment with different price points and subscription models and, crucially, it could try those without first convincing any incumbents.  Both Blockbuster and Netflix's DVD-by-mail service relied on the first sale doctrine, meaning they can buy physical copies of movies, and then resell or rent at any price they like.  No royalties, no licenses, no contracts—with physical media, once a rental company has bought the copy, the copyright holder is basically out of the picture. 

You can see how this is great for users.  Companies can experiment to find the things that people like best, and have the power to make decisions based on their users' needs and wants.  Movie studios still got paid—these rental companies were buying lots and lots of copies, after all—but couldn't exert control over the rental businesses, which could then compete on their merits. 

Rightsholders hate not having this control.  So the first sale doctrine gets attacked over and over.  From Nintendo's suing Blockbuster in the 80s to Universal's "revenue sharing agreement" with Redbox, and through to more recent cases like Kirtsaeng v. Wiley in the Supreme Court, rightsholders have tried to restrict the first sale doctrine in physical media.  And when it comes to digital media, consumers have even more of an uphill battle. 

When the ranking member of the House Subcommittee on intellectual property is calling the principle of "you bought it, you own it" an extreme view, there's something seriously wrong here.  Furthermore, the Netflix example shows that the problem isn't confined to the books, movies, records, and games that we own; it limits the kinds of services that can ever be created. 

With a commercial product like Netflix, we can feel those costs today.  But more troubling are the costs we will feel tomorrow, in a decade or a century from now, if we make a transition to digital media without keeping the first sale doctrine intact.  Copyright has already cost us crucial elements of our cinematic and literary history.  Those costs will compound if librarians, archivists, and enthusiasts aren't allowed to care for their own copies. 

As Matt Schruers over at the DisCo Project notes, studio practices have ensured that no option so far can be convenient, comprehensive, and lawful.  Netflix Instant is a great service for what it is able to offer, but in a permission culture it is broken from the start. 

Reader Comments

It is easy to see why the movie and recording industries are in love with the windowing model.*It used to work so well and was extremely profitable.*The careers of many industry executives was built around clever manipulation of the windowing model. 

Those are very powerful reasons for keeping something around.  Of course, there are some downsides:*Windowing does not make nearly as much sense give a global internet*It is no longer as profitable as it used to be.  In fact, it is probably reducing profits.*It encourages piracy.*Its existence may threaten the survival of the industry in its current form. 

For inbred corporate insiders, none of those reasons are good enough to change a way of doing business that you know and love. 

Re:

One of the biggest reasons for piracy is the control the few want over the many, Piracy is not going anywhere, in fact it is getting bigger and bigger, Governments beware making the majority of your citizens criminals and not listening to a super majority. 

Luckily, places like Amazon and YouTube and Netflix and Hulu are starting to create their own content and take the market away from the incumbents, hopefully as big internet savvy businesses they will accept the internet and how it works rather than fight it. 

The incumbents have lost the war against piracy no matter how many times they claim they are winning, it is easier today to access content than it was even yesterday. 

Hopefully thepiratebay browser will be released soon with the anonymity it brings to sharing content well partial anonymity. 

With the ruling in the EU against ISP's retaining data about your browsing habits i am sure Piracy will only benefit. 

Once the content creators realize how they are being left behind and how people are getting their content and other content that competes with them easier and cheaper or for free they have no option but to compete, if that means jumping ship and doing deals with the internet behemoths we shall see.  All we really have to understand at this point is that the money-ship that was copyright that benefited a few people is sinking and the people on-board trying to protect their income stream are doing anything they can to stop the sinking, sadly for them but happily for us it is like they are. 

Content controllers are almost history and will be removed from the picture in one foul swoop when Torrenting is legalized and they have no option but to compete with free.  They can do whatever they want they can scream and cry and collapse in on themselves threaten to stop creating content or distributing it in any way...There will always be people to replace them, and jobs they threaten, well, I would like to see how they create movies or anything without labor and paying people, they might find that though they dismiss the people doing the physical work refusing to pay them will only result in one thing, people looking elsewhere to work and taking their experience with them. 

And one thing that will never change, people will invest in movies for cinemas, cinemas make the investors a hell of a lot of money and they will not stop creating for cinemas, those that do will be doing so at their peril of becoming irrelevant as others fill the gaps they leave behind. 

I cannot personally wait for the collapse of the copyright system and the new era of free content online, it will force many businesses to actually compete instead of ripping people off.  TV will change forever and cable will have to start providing something that really attracts people not the 1000 channels and nothing to watch. 

Broadband providers will be forced to provide the service they advertise, but refuse to provide they will be forced to enlarge the pipes and allow more data to flow and if they try to overcharge well new ISP's will be popping up everywhere. 

Content creators will have to look for a way to monetize their content, maybe think about costs instead of charging millions for 30 minutes of content, but they will do it there is a lot of money in content this website has proven again and again that free can make money. 

Sorry for the rant i am just pissed that i have to live through this and it cannot be resolved quicker than it is. 

Re: Re:

One mistake: please stop calling abusive publishers "content creators."  These guys creating the content are very rarely the problem; the ones distributing it are, and they're generally completely distinct from the content creators. 

That's the thing that far too many people don't understand about copyright, and it gives undeserved legitimacy to the current system: if people think it's sticking up for the rights of content creators, then it's a good thing, right?  But when people understand that it's actually enabling publishers to exploit the content creators along with all the rest of us, their attitude changes fast. 

A problem (there are many) is that permissions on distribution appears tied to the transportation of the product (mailman delivering dvds vs 1's and 0's shooting through a "series of tubes") instead of the end result...a subscriber requesting and receiving the product. 

Either Netflix (or other service) has permission to deliver to their subscribers the products they're requesting or Netflix doesn't.  How it gets there shouldn't be a matter for debate. 

Re:

Either Netflix (or other service) has permission to deliver to their subscribers the products they're requesting or Netflix doesn't.  How it gets there shouldn't be a matter for debate. 

It shouldn't, but it is, and the reason it is so is because of the interpretation of the law in physical land vs on the internet (like everything else.)  For physical land, the mailman is delivering a piece of plastic.  The piece of plastic contains a copy of the movie which has been licensed ahead of time to the owner/possessor of the piece of plastic.  On the internet, there is no piece of plastic, and thus, the producer limits their license to allow for it to be distributed only during particular times/reasons. 

Congress will need to fix the law to prevent the copyright maximalists from differentiating the two (which they won't, because their paymasters don't want the current system to change.) 

What would be really interesting is to see Hollywood's current model for online distribution pushed into the physical realm (which they've already tried to do a number of times, to limited success.)  Imagine Hollywood having a system in place where that piece of plastic wouldn't work if an exclusive window was entered or if the movie was deemed to be no longer worth distributing.  DRM at its worse.  I suspect that is really what AACS is about...not preventing piracy, but enforcing windowing in a physical medium (hence the required callback mechanism when a Bluray is played.) 

Artistic megalomania not required. 

...again with the distortion of the law to suit large corporate interests. 

With a piece of plastic there is NO LICENSE.  You get to do what you want with your copy because it is your personal property.  There is no license of any sort (explicit or implied).  THAT is why the Netflix mailer system works. 

There is none of this "license" nonsense. 

It's just Netflix using it's personal property as it sees fit. 

No "permission" is required because this is stuff that was settled in favor of individual property rights over 100 years ago. 

It all get's fouled up once you go "fully digital" because you no longer have physical property anymore or any of it's characteristics.  Moguls love it when they get to benefit from property rights concepts but hate it when it might benefit anyone else. 

The idea that my personal property is subject to any sort of implied "permissions" damages us all, even the Moguls. 

Re: Re: Artistic megalomania not required. 

"The discs that rental services are lending out are a lot more expensive, because they have a specific license attached to them that allow rental (but not resale)." 

But there is nothing that requires rental services to use those discs.  They can buy normal retail discs just like you or I and rent them out all they want without incurring any licensing or other legal problems.  So in the big picture, this isn't a license issue at all. 

Re: Artistic megalomania not required. 

"With a piece of plastic there is NO LICENSE.  You get to do what you want with your copy because it is your personal property." 

If that's true, then why are services that allow DVDs to be backed up and easily played back through an archive always being sued?  Even breaking the CSS code or region code to play back the movie you "own" is technically illegal and they almost had someone thrown in jail for writing code (DeCSS) to play it back on Linux when they refused to licence it to an open source system.  That's not to mention all the pre-DVD methods they tried to use to block you from playing your own movies in an unapproved manner (e.g. Macrovision). 

If you think this is only a problem with physical media, you're deluding yourself. 

"The idea that my personal property is subject to any sort of implied "permissions" damages us all, even the Moguls." 

Re: Re: Artistic megalomania not required. 

Even with what you describe there is still NO LICENSE.  There are technological measures that have been given the force of law by corporate lobbying.  Conflating these to some sort of "implicit license" is destructive to the idea of personal property in general. 

That's the real problem here.  It's not just that you don't have any rights without a physical object but that plenty of people (including yourself) are hard at work undermining everyone's personal property rights too.  Not only are "meatspace" ideas not being applied to "cyberspace" but people are trying to push things the other way. 

Re: Re: Re: Artistic megalomania not required. 

"Even with what you describe there is still NO LICENSE"

You know that copyright notice that everyone ignores or skips past at the beginning/end of every DVD you buy?  That's the licence.  Read it some time.  You'd be amazed at what you're supposedly not allowed to do with that physical item you thought you owned.  Most people ignore the restrictions as much as the notice itself, but it's there and technically enforceable by law (though until Napster et al provided full visibility about how many people ignore those warnings, they didn't bother going against individual infringers). 

"There are technological measures that have been given the force of law by corporate lobbying." 

To protect the LICENCE from being broken.  There's no other reason for copying restrictions, region restrictions, etc.  other than to "protect" the "licence".  The DMCA might be a half-assed tool to try and make the licence enforceable, but I have VHS tapes with the same warnings, and similar warnings on paperback books. 

We might not agree with the existence of the licence, but it's there. 

"that plenty of people (including yourself) are hard at work undermining everyone's personal property rights too"

Oh, this should be good.  Explain why you think *I'm* doing that.  Is it because I don't pirate, or because I circumvent the restrictions I think shouldn't exist by, for example, using VLC to skip warnings and bypass region codes? 

"Clueless nitwits constantly repeat corporate propaganda." 

Indeed they do.  But that doesn't mean that the idiotic licences and restrictions don't exist - half the problem we have here is that they're very much real.  Yes, even on that bit of plastic. 

Re: Re: Re: Re: Artistic megalomania not required. 

That's right.  Try reading the copyright warning you (and I) prefer to skip over at the start.  Then you'll see what you're restricted to doing with "your property." 

It's not your property, it's a licensed item.  The terms are restricted to home use only and enforceable in court. 

The only ones with any property rights are the rightsholders.  That alone is an argument for restricted copyright terms.  Imagine being arrested for screening a 40 year old movie in a large hall and inviting your friends and neighbors to watch it.  Not fair, is it? 

Can you imagine if you need permission to perform covers of songs?!  Of course, someone is making a ton of money (and paying out only a small portion) on licensing fees, so it's all good. 

A system should exist for movies and TV shows after 3 or 10 years.  Anyone can stream them if they pay a reasonable license fee.  Of course the reasonable part of the equation will be the most difficult. 

Re:

Like everything about your comment except the 3 or 10 years.  I think as soon as they offer a movie anyway other than at the theater, or a TV show is beyond it's current season, the mandatory licensing provisions should kick in. 

I agree that the reasonable will be the difficult part, because what the entertainment industry considers reasonable will be anything but. 

and people still wont accept that what the entertainment industries are really after, is complete control of the Internet!  the best distribution method invented!  all the bad things that the industries call out about, blame the Internet for etc, etc, will all go out the window once they have that control.  nothing will ever be illegal, nothing will ever be restricted (other than the money side of things) so using torrent will be the dogs danglies of file transfer protocols and as thousands will be downloading at the same time from everyone, the cost to the industries will be miniscule! 

My evolution

I realize that I'm an edge case -- I don't watch cable or broadcast TV at all, and haven't for a decade or two.  However, I do watch movies and TV shows through Netflix.  I was with Netflix before they had a streaming service, and have gradually reached the point where Netflix streaming is my sole source of movies or TV shows (excluding going to the theater, as I consider that more about the date than the show).  I don't bother with the discs anymore at all. 

If and when the Netflix offerings no longer contain anything of interest to me, I'll move on to... nothing whatsoever.  So, in my case anyway, the more the production companies do to reduce the Netflix streaming library, the less of their stuff I will watch until, eventually, they'll have lost me as a customer completely. 

I literally can't think of a single movie or TV show that is so compelling that I'm willing to suffer any inconvenience to see. 

Re: My evolution

Netflix is nearly an exclusive source for me too (although naturally I have to use VPN services to be allowed to watch anything - thanks, regional licensing that refuses to allow them to offer local services here!).  Frankly, while I can understand the frustration with not being able to find Movie X on the service, I'm a long, long way from exhausting the selection.  Plenty is added every month, even if some movies disappear.  I really can't understand the mindset of people who claim there's "nothing" - I'm more likely to stare at the screen for 10 minutes trying to decide what to watch. 

But, I'm someone with wide tastes and enjoys foreign language and older movies as much as new blockbuster releases.  I still buy discs, but they're far more likely to be cult video releases with lots of extras from companies like Arrow and Blue Underground than they are to be anything remotely related to Hollywood.  Whereas 10-15 years ago, I'd often blind buy the latest VHS or DVD without thinking.  I got burned too many times with crappy movies or double-dipping, so the studios' own actions lost them a regular customer.  I'm probably not alone, yet they seem to think that preventing easy access to legal content is the answer...

Re: Re: My evolution

"I really can't understand the mindset of people who claim there's "nothing"

Agreed.  Really, there's more stuff I'm interested in on Netflix than I have time remaining in my life to watch. 

"But, I'm someone with wide tastes and enjoys foreign language and older movies as much as new blockbuster releases." 

And I think this is the answer to the mystery you point out.  When I've talked with people who say Netflix has nothing, what they invariably mean is that Netflix doesn't have much of the most current stuff.  Which is true.  For me, that doesn't matter -- there is nothing magical about the current stuff.  The stuff that is a couple of seasons (or years, or decades) old is just as good or better as the most recent titles, and the majority of it is "new to me".  For some people, though -- although I have a hard time understanding why -- it seems to matter a great deal.  Different strokes and all that. 

Re: Re: Re: My evolution

Netflix has current stuff, but it doesn't have much major Hollywood blockbuster stuff - which is what most people want to see because Hollywood has convinced them that it's somehow important to see it. 

I'm perfectly happy browsing through the hundreds of movies in my Netflix queue and there's a vast wide world of movies out there to explore. 

Re: Re: Permissions Clause

Copyright never had anything to do with protecting authors and creators, it purpose was to protect printers from being left with unsold copies due to a competitor coming into the same market, and also being left with unsold copies.  From there it got expanded by the recording industry and into performance rights, again protecting middlemen, or creating even more middlemen in the collection societies. 

This is why I don't understand why the studios haven't gone whole hog for Netflix.  If they stop putting movies on disc and just stream them they can have complete control over distribution.  No more used market, less piracy, and say over who gets their content and who doesn't.  You'd think that would be the ideal scenario for them. 

Re:

"If they stop putting movies on disc and just stream them they can have complete control over distribution." 

Not if they simply allow Netflix to stream them.  They'd be beholden to Netflix in the same way that the music industry inadvertently depends on iTunes and the publishing industry on Amazon for much of their distribution. But, Netflix is the household name in the industry so simply offering a half-assed alternative of their own making isn't going to cut it either. 

Plus, I suspect it's the same thing that gets people so bitchy about Spotify and Pandora - while they get paid, they don't get paid *enough* and they think they can still get physical purchase prices for digital rentals somehow...

"You'd think that would be the ideal scenario for them." 

You'd also have thought that they'd realise that putting patronising lectures in front of legal purchases, crappy DRM solutions like Ultraviolet and unworkable region coding schemes don't translate into more money or reduced piracy and in fact just piss off legal consumers.  Alas...

Re:

PaulT made a similar point -- the studios aren't concerned about piracy or the details of how the delivery system works.  They're concerned about losing their monopoly on the delivery system.  Relying on Netflix would be the ultmate nightmare scenario of losing their monopoly -- they'd be effectively giving the monopoly to someone else. 

I think this is a critical point because it's also exactly why they hate the internet itself and are working so hard to eliminate the aspects of it that threaten their monopoly. 

Remember, the studios don't really make their money from making movies.  They make their money from distributing movies whether they make them or not.  The internet allows filmmakers to effectively distribute their art without involving the studios.  That is an existential threat to them. 

Wonder why Netflix didn't file an amicus brief in favor of Aereo - if Aereo wins in the Supreme Court, you'd think they'd be able to end all their streaming deals and just buy enough discs to stream whatever a customer wants. 

(Then again, I think the error message "we've only got 30 copies of this movie, and they're all currently in use" would probably annoy the heck out of me.) 

Re:

Missing the point

What the comments and the article itself seem to be missing, is return on investment.  Windowing is a simple sequence to maximize revenue, which is the only responsible option for executives running publically held companies - it's not like it's a greedy maniacal concept - they simply need to pay for the negative cost of producing the first print, which includes script, actors, etc.. Streaming subscriptions don't begin to cover the cost and disc subscriptions barely replace the revenue once earned by selling copies to video retail stores that don't exist anymore.  The quality of streaming content being offered won't improve until the revenue delivered can replace the physical disc revenue.  Those lines at the Redbox represent the video stores that used to be on every street corner.  And by the way - you can stream front line movies right now - it's called on demand, but it comes with a per click charge and shareholders in the companies producing the content don't mind a bit.  And the only way to enjoy full quality Blu-ray is via physical disc. 

Re: Missing the point

I don't think anyone is missing the ROI aspect, and I think most everyone knows what windowing and what the purpose of it is.  I'm not sure of your point, unless it's just that you're fine with windowing -- which is a valid opinion, but isn't shared with a lot of people. 

I personally don't have any kind of issue with windowing itself.  What I do have an issue with is all the crap that is used to enforce it.  My attitude about it is pretty much the same as my attitude around piracy: I'm against it and don't have an issue with companies trying to minimize it.  I do have an issue with the specific things they do to minimize it, though. 

Re: Missing the point

To *attempt* to maximise revenue.  It no longer works like it did, mostly because it's so artificial and consumers recognise this.  It's a big driver toward piracy as much as sales. 

"which is the only responsible option for executives running publically held companies"

I disagree. 

"hey simply need to pay for the negative cost of producing the first print"

Which they can do using many methods, many of them less expensive than the added cost of a theatrical run.  Lots of people never go to the cinema, you're not getting more money from those people jsut because you make them wait 6 months before they can see your movie. 

"The quality of streaming content being offered"

...is perfectly fine for most people.  I hear many complaints about Netflix, but picture quality is never one of them.  Not everyone wants or need a HD copy. 

"And the only way to enjoy full quality Blu-ray is via physical disc." 

So?  Again, not everyone want or needs that.  Some people watch your movie on a phone or portable TV where Blu makes no difference, and they are happy with that. 

If the studios were smart they would stop protecting the dinosaur media and get a hand up on piracy and middle men like Netflix by creating their own new media model.  Have linear channels by movie genre or show type, back catalogs on demand, original content, etc.  for around $10-$25 a month.  Integrate your store into the service to entice people to buy the DVD, Blu-ray, download or even merchandise for extra revenue potential.  Seems so easy...

Very Entertaining

I'm in my own little world here as a minimalist, so I'll just chuck in a passing comment...

Self Reliance has taught me to do virtually everything offline.  I use the web for simple e-mail communications and research.  That's it.  Never rely on the Internet much less on "streaming" technology (more like streaming money out of your wallet into corporate hands).  Imagine every time you turn a screen on, you Pay someone.  That's what the future of this technology holds. And then there's these idiots who so proudly proclaim they're "cutting cable" and going with some streaming tech instead--they're just substituting one thing for another, albeit cheaper it's still the same concept of peeing your money away.  And you'll always be a slave to what They have Available as opposed to what You Want.  Don't bitch about smaller selections, higher prices, and fewer choices once these things take off.  Inevitably it'll be no different than your old cable service.  Do things yourself and build your own library offline, if you want to be smart.  At least when I first got cable, circa 1980, I was smart because that was when I got my first VCR (of many to come) and when blank tapes reached a record low of around a buck I stocked up.  I taped, taped, taped all my favorite films and shows--and stored them (go ahead, make a crack about squirreling things away!).  Now I have a library.  Granted, grainy in places , but so what?  For the stuff I Really care about I switch to my DVD collection.  Some things will Never become available on DVD much less streaming.  But I've got some of them... This is the logical way to go rather than Paying for each and every time you want to See something.  I won't even mention certain intrusive factors which should spark paranoids to action but, hey, I'm not going there.  Cell phones are worse and you Accept those.  Maybe it's just me because, television shows in particular, I thought were Free--as in just having a TV set around you could tune them in and watch them and, during the dawn of the VCR age, tape them and play them back at your own leisure.  To put it another way, it's a crime to Charge people to watch decades old TV shows!  And believe me, that's where my prime interest lies: in the old stuff.  And there lies another problem: Internet Access should be Free--and I don't mean wireless microwave-slow-cooking tech, either.  Oh, I can get new movies and series If I want through my own means and it'll cost me pennies, and it's got little to do with Internet access.  And these people who trust things like "the cloud" and other online storage mediums are fools.  Cutoff or restrict your access and you're screwed.  A crash of their servers or storage mediums (through hacking or natural means) and you're screwed.  But physically hold your favorite movie on DVD (or even tape) in one hand Now and it's Yours and it can't be taken away from you.  Play it as many times as you wish without fear of some charge.  That's true freedom, independence, and self-reliance--cutting out corporate crud. Oh, yeah, streaming is the new way to go you'll read everywhere.  I'm sure A Lot of businesses would also Love to do things for you as a Paid Service streaming income from you into their pockets.  Lots of people would jump at the chance to wipe your ass for $100 a wipe. That's what this is really all about.  And they'll put a prestige tag on it, too, and the sheeple will do their thing, much like they get people to fork out big bucks for luxury cars and wastful SUVs they don't need.  People will Boast about what they have and you don't So, you'll counter it by Becoming one of them. 

Speaking of Online vs. Offline... You've got to be out of your mind to fall for these "virtual casinos" which are Not real casinos in the least.  Basically you're handing your credit card over to an absolute anonymous stranger to play games--with you.  These things aren't regulated and they can do whatever the hell they want to with you.  Win, lose, hacked, whatever. 

Re: Very Entertaining

Well, since you took the time to proudly pronounce how much time you spend not using the internet (so much that you wrote a small novel online to tell everyone about it on a year-old article), I'll happily point out a few flaws in your arguments. 

"And then there's these idiots who so proudly proclaim they're "cutting cable" and going with some streaming tech instead--they're just substituting one thing for another, albeit cheaper "

If you meet one of these "idiots" who claims that the price isn't a major factor that drives them to move away from cable, then fine.  Otherwise... you're attacking people for exercising their freedom of choice and make a good financial decision?  Really? 

"And you'll always be a slave to what They have Available as opposed to what You Want." 

So, same as every other medium?  You've always been a "slave" to what your local stores stock, what your TV channels decide to show, what a studio decides to release, etc.  But you attack people who move away from cable with its higher prices and lower choice as "idiots"?  Plus, you seem intent on rejecting the very real possibility that what a streaming service offers and what a person wants are actually the same thing.  My own main problem with Netflix is that I'll never have time to watch everything on my ever-growing to watch list. 

So, you don't have any interest in watching anything produced in the last decade or two?  No interest in watching a better quality copy than VHS can provide?  Fair enough, but you seem rather intent on attacking people for making the choice that benefits them the most. 

"A crash of their servers or storage mediums (through hacking or natural means) and you're screwed.  But physically hold your favorite movie on DVD (or even tape) in one hand Now and it's Yours and it can't be taken away from you." 

You seem confused about the concept of a rental service vs. a product you purchase.  Streaming services are rental services, so your analogy is idiotic. 

"These things aren't regulated"

This is an outright lie.  Oh, the legal status of these services in the US does attract some shady players, but I can assure you that in Europe at least, the industry is highly regulated.  Your problem would seem to be the laws that prevent the regulated services from servicing the US market, not the nature of online gaming as a whole.