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Consumers Poised To Pay More For Web-Delivered Video Than For Discs: Report

By DAVID LIEBERMAN, Executive Editor | Friday June 1, 2012 @ 10:45am PDTTags: Blu-ray, DVD, home video

Spending for DVDs and Blu-ray discs is falling so fast that 2012 likely will be first year when consumers will pay more to buy and rent movies via the Internet, according to a report today from IHS Screen Digest Video Intelligence Service. The research firm says that the average household will spend $123.50 to buy and rent discs this year — down from $133.21 last year and $149.53 in 2010. The average home spent $206.78 in 2006, when Blu-ray discs were introduced. Looked at another way, people spent $8.8B last year to buy packaged videos, down 12% vs 2010. That will keep falling to $5.4B in 2016 — which IHS notes is “the level in 1997 when DVDs were first launched.” Meanwhile, consumers paid $5.7B to rent discs last year, down 7.3%. Much of that drop was due to the cut backs at Blockbuster, as well as the snafus at Netflix’ DVD rental business. With that largely behind us, and rental kiosks becoming more popular, disc rentals will increase slightly to $6B in 2016. IHS says that kiosks accounted for 34% of disc rental spending last year, and will grow to 41% this year, and hit 52% in 2015. The silver lining for studios is that the online business is growing. “If revenue were to be added from other viewing options such as video-on-demand, Internet-based sales and rentals, and subscription streaming from providers like Netflix and Hulu Plus…consumer spending across all outlets of home video would amount to nearly $17.2B,” says IHS senior analyst for U.S. video Michael Arrington. In a separate report, IHS said that spending for online movies more than doubled to $992M last year, mostly due to the growth of Netflix’s streaming service — which passed Apple to be the No. 1 online movie provider. Web spending is expected to double again this year but then slow, the company says, unless a company such as HBO offers a standalone streaming service or someone offers a Web-based replacement for pay TV.

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Netflix Could Undermine UltraViolet As Low Cost Rentals Trash Studio Profits: Report

By DAVID LIEBERMAN, Executive Editor | Tuesday April 3, 2012 @ 12:58pm PDTTags: Big Deals Film, Big Deals TV, Blu-ray, DVDs, home video, Netflix, Studios Finance, UltraViolet

Moguls will need a stiff drink nearby when they read Morgan Stanley analyst Benjamin Swinburne’s bracing report today about the state of the home video business — and Hollywood studios. He says that film operations at Universal, Disney, Paramount, Fox, and Warner Bros are worth about $19.3B, down from $40.2B in 2007. And a big reason for the 52% drop is that studios’ annual home video profits from each TV household fell to $100 last year from $127 in 2007 — and will continue to slide to $93 in 2015. Sales and high-priced rentals of DVDs and Blu-ray discs from retailers such as Blockbuster are simply falling too fast as consumers discover that they can do just fine paying $1.20 a night to rent a disc at a kiosk — or less to watch a movie from Netflix. The analyst says it’s possible that studios will boost sales of discs with the UltraViolet initiative, which gives buyers opportunities to stream the movies to mobile and other digital devices. But probably not: Read More »

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Fox To Promote Home Video Sales With Shopping Mall And Smartphone Initiatives

By DAVID LIEBERMAN, Executive Editor | Tuesday March 13, 2012 @ 8:14pm PDTTags: home video, Twentieth Century Fox Home Entertainment

EXCLUSIVE: Shoppers at malls owned by Taubman Centers will see something unusual beginning Wednesday. As part of an exclusive one-year partnership with Twentieth Century Fox Home Entertainment, the malls will have a wall with cover art and QR codes for many the studio’s home videos. People who want to buy the movie or TV show can download a smartphone app called Fox Movie Mall, available for both iPhones and Android devices. It will enable them to scan an image and go directly to a Web site to complete the purchase for a DVD or Blu-ray disc shipped free to their home. The studio will offer discounts and goodies such as games, trailers, and additional clips for people who use the app. Fox expects to reach as many as 60M people over the next four months with the mall wallscapes. As part of the deal with Taubman, Fox also will set up  lounges in several malls that will have TVs featuring  Read More »

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