Consumers, however, are programmed to accept whatever is currently in circulation. To some degree, it's embedded within the collective psychology of the culture to go down to the local retail store and see what titles are on the shelf. If they could be made aware that an old movie that they haven't seen since childhood is up for purchase, they might get used to going back to a media company's content universe again and again to build their own customized library. It might be a culture shock, but it would be a happy one.

The key is going to be availability. Media companies must make everything in their libraries available. I know there are tons of old TV shows and specials that I would love to order up that haven't come out on DVD. And think of the opportunities to remind people that these shows exist. I'd imagine that the service would sell itself in short order. Plus, new generations might come to appreciate old content .

Now, on-demand DVD technologies will never supplant the traditional home-video model of distribution. For one thing, I'd have to assume that on-demand discs will always be a barebones proposition in that they won't include extras. That means that there will always be a need for product that captures the demand for editions aimed at collectors and the consumer who, while more casual in nature, nevertheless wants to see featurettes and other value-added stuff.

And, going back to consumer psychology, it's a ritual to go out to stores every Tuesday to see what's new. That's never going to change. No matter what, media companies like Disney (NYSE: DIS) and Sony (NYSE: SNE) will always have a need to carry large amounts of inventories to capture revenues for their studio operations. And while you might be thinking that digital on-demand services might be the better way to go, remember too that there will always be a segment that will want physical media. Indeed, I'll have to assume that there will always be an advanced form of physical media that may afford a better quality viewing experience than what can be achieved on digital platforms.

Still, Time Warner, and all media companies for that matter, might help shareholder value out by really going after on-demand DVD monetization of their libraries. The stocks of many media companies haven't fared well over long periods of time (although they recently experienced a bull run), so anything management can do to leverage content is welcome.

Disclosure: I own Disney; positions can change without notice.