Without going into detail the system is deployed close or in immediate contact with the point of purchase. The user chose a DVDtitle and sends a request to the Q-Flix system. The system starts the burning procedure, labeling and packaging. All in a couple of minutes from that the customers have made the choice. Naturally, the more advanced in-store burning kiosks can handle multiple request at a time.
This might look like a fairly simple technical task to perform and I am not really knowledgable enough to commnet on that. However, for those of you knowing about DVD crypto keys to prevent copying and printing a DVD label in less than a minute can perhaps figure out that quite some engineering is encumbered in the solution.
Intangible Assets and Capabilities
The most important asset is access to content. Currently Q-Flix claims to have agreements with all major studios and access to 14,000 movie titels and over 2000 TV episodes. Another asset is compliance to standards. The DVDs bought from a Q-Flix system must be no different from the ones I buy online of off the shelf. The third asset is strategic alliances. Currently Q-Flix has an alliance with Dell, where Dell is acting as a technology supplier and retailer. They also have alliances with other companies to get access to their distribution and sales channels.
Providing access to the Long Tail and the merchandized feeling
Well, given that you now can reduce/remove the shelf space and there is not capitalization in stock the Long Tail of golden oldies and niche movies can now be brought back to the supermarket. Moreover, since there is a digital process forming the image to be burnt onto the disc customization by the customer and merchandizing by the provider is possible.
Weather or not this will save the optical information carrier from disappearing is quite unclear. I like the approach though, at some sense it is greener and it enables more spontaneous shopipng for physical copies of old or more niche copies.
Mathias Hellman (follow me on Twitter)