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Time Warner CFO: UltraViolet Aimed at Reversing Rental Trend

25 May, 2011 By: Erik Gruenwedel

Executive says home entertainment industry poised for ‘brighter days’

The CFO of Time Warner Inc. said Warner Bros. is poised to redirect a rental-centric home entertainment market through the use of UltraViolet — the industry-wide digital storage platform.

Speaking May 25 at the Barclays Capital’s Global Communications, Media & Technology Confab in New York, John Martin said the recent purchase of movie recommendation website Flixster.com and movie rating site RottenTomatoes.com was geared toward the two becoming “front-end” consumer apps in UltraViolet and spurring consumers to purchase (and rent) content.

“To be able to very easily upload your existing [and new] DVDs and have the ability to access them across multiple devices, while managing your collections with social aspects as well [is the goal of UltraViolet],” Martin said. “All of that will ease the ability to buy or rent with just clicks [of a keypad, button or mouse] … and is something that doesn’t exist today.”

Martin said the studio would be addressing UltraViolet in the coming months with greater “specificity.”

The executive reiterated that Warner Bros.’ first quarter was relatively light (as were all studios) due to the timing of theatrical releases and dearth of strong home video titles.

Martin maintained the studio is on tap to produce an “all-time record year,” beginning May 26 with the theatrical release of The Hangover Part II, which he encouraged attendees to see at least twice.

The CFO said that despite the end of the “Harry Potter” franchise this summer, the studio’s success has not been predicated by that one title.

“We’ve known for a few years that “Harry Potter” was coming to an end. It’s hasn’t snuck up on us,” Martin said. “We’ve been trying to create new franchises, the first, Green Lantern, which launches June 17.”

He said the studio would continue producing 20 to 25 movies per year despite a home entertainment business Martin characterized as “very mature” and declining during the past few years.

“The key there is going to be transitioning into digital and try to aggressively move it as quickly as we can,” Martin said. “I think there are going to be brighter days there.”

He said that what separates Warner Bros. from other studios is that it generates 50% of profits from theatrical and 50% from TV program production. Warner Bros. Television has 27 programs airing on the networks this fall, up one program from last year and featuring 12 new serials.

“We’ll have at least four shows on each network,” Martin said. “No one else is doing that. That’s something that I don’t think gets appreciated enough and differentiates us from a lot of other studios.”

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