Abstract: WantedList believes that over the course of the next 5-10 years, the DVD Rental subscription model will become the most popular way consumers get their adult movies. Obtaining adult products through the usage of broadband services be, it VOD, or some form of streaming media, will be the future, but there are still too many "last mile" issues that must be resolved before any of these services becomes a meaningful business model.

Large cable and telecom companies that control the pipes have monopolized the market and are extremely slow to improve on their networks. This has lead to a decrease in the adoption rate for broadband technology. In the meantime, the market has blossomed for the adult DVD rental subscription model. Americans are spending more and more to improve their home entertainment system. The DVD is more ubiquitous than VHS. Netflix and Blockbuster have legitimized the online subscription model, but do not carry adult products. The next logical step for the consumer is to get out of the video store and online where they can find WantedList's DVD rental subscription model.

Broadband technology won't increase significantly due to:

• Government bandwidth regulations (Criterion Economics, 2004)
• Cable industry limits on competition (Brookings Institute, Policy Brief #105)

Adoption rates for the internet and broadband has slowed significantly, meaning that we're not adding many new broadband subscribers and most dial-up subscribers are satisfied with their speed

• "PC adoption rate has stabilized at 87.6%, with 61.8% of these PC households connected to the Internet. In the past 25 months, Internet adoption rate has been feeble at 4% http://www.ntia.doc.gov/reports/anol/NationOnlineBroadband04.pdf
• The percentage of Broadband households is at 19.9%, equivalent to approximately 22 M households http://www.pewinternet.org/pdfs/PIP_Broadband04.DataMemo.pdf
• "A majority of Dial-up Internet users are content with this connection (60%), whereas 40% would like to upgrade. For the former, the main reasons are lack of interest and cost": http://www.usagewatch.org/2004/11/broadband_adopt_1.html
  • They don't need nor are interested: 44.1%
  • Too expensive: 38.9%
  • Not available is cited by one Dial-up user in ten (9.8%) on average, but by more than one in five (22.1%) Dial-up users in rural areas.

Home Theatre Systems Purchases have increased dramatically:

• DVD player purchases have reached VCR levels and DVD sales have eclipsed VHS sales. The Consumer Electronics Association estimates that 75% of households own a DVD player.
• U.S. consumers buy 25 million new TVs each year http://www.ubercool.com/ubertrends/technology/
• In 2004, Americans spent an average of 78 hours watching videos and DVDs, a 53% increase over 2000, according the Motion Picture Association of America. Not surprisingly, movie attendance is declining, down 4% in 2003, 2% in 2004 and 8% so far in 2005.

Netflix and Blockbuster have made the DVD rental subscription model pervasive

• 12% of US households currently use one of the two major DVD rental services
• By 2009 Online DVD rental subscription model will hit 15 million US households (AMR)

WantedList

• Looking to adult is the natural evolution in adult consumption. The timeline is
  • Pussycat theaters (Extremely public)
  • VHS (Semi public - Video store patronage still required)
  • Internet (Completely anonymous)
  • DVD Player (Semi public - Video store patronage still required)
  • WantedList - combines that last 2 advances in technology without the requirements of broadband technology
• Not to say the VOD market won't become large in the next decade, but this is the decade of the online adult DVD subscription service.
  • "Video-on-demand technology is spreading rapidly, and will become pervasive in the decade ahead," noted Adams Media Research's president and senior analyst Tom Adams, "but turning that technology into a substantial movie market is going to require a complete reassessment of the industry's 10-year-old assumptions about VOD.

WantedList believes in providing valuable service to its subscribers by utilizing the consumer's need for privacy, anonymity, and trust. WantedList is building brand loyalty so the once broadband surmounts the issues that it now faces to become the premier delivery vehicle, WantedList will be poised on the forefront of providing these newly dependable services to it's already amassed subscriber base.