Update: Peerflix won the CEO Pitch Award at AO Innovation Summit!
Please note that this is off-topic for ComparisonEngines, but there are many innovative companies/technologies out there, and I want to share some information that I find interesting.
Billy McNair, co-founder of Peerflix made the pitch.
Ok, this is one to really pay attention to. Smart and simple business. You will definitely hear a lot about this company in the future. Here’s the deal: 75% of househoulds have a DVD player. Last year, those households bought on average 19 DVDs. Most people just watch a DVD once and then put it on the shelf to collect dust. While owners could sell those DVDs at a local store (like Tower) or trade the DVDs in for discounts on new DVDs (Blockbuster has a program like this), Peerflix allows people to trade their DVDs. As a member, you creat 2 lists: the first is a list of the DVDs you own, the second is a list of DVDs that you want. Peerflix sends you a welcome kit with envelopes for the DVDs (you pay for postage). The trading then begins. Peerflix charges a $0.99 fee per transaction. No membership fees, no monthly fees. The company has no inventory, no distribution centers. Peerflix is starting out with DVDs, but there are obviously many other products to expand into.
One dilemma though…while listening to the pitch, I couldn’t help but notice that this ends up being equivalent to the various gear-trading platforms that are being built inside college communities…particularly around textbooks. And in those endeavors, the user is faced with a catch-22: Can’t receive books because there isn’t enough trading activity going on, and won’t offer books because there isn’t any assurance that they’ll be successfully unloaded.
So two big questions arise:
1. Will they ever capture the long tail of great obscure stuff ala Amazon? A site that deals only in mainstream titles might not actually be any more convenient than half.com or straight-up eBay trading, especially since it won’t have an ecology of accredited, quality sellers. Who’s responsible when the traded-for DVD is scratched up to oblivion?
2. Has this concept worked before? The natural first application probably wasn’t DVDs, but -trading cards-. I’d be curious to find out how the first generation online trading platforms did…I worry that PeerFlix might be using a model that already lost to eBay in the annals of history…