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Fox Separates Rental, Sellthrough for Blu-ray, DVD

5 Mar, 2009 By: Erik Gruenwedel

Seeking to bolster packaged-media sales in the faltering economy, 20th Century Fox Home Entertainment for the first time is implementing separate packaging and SKUs on select rental and sellthrough Blu-ray and DVD titles, beginning later this month.

The studio never previously separated title shipments, including packaging based on rental or sellthrough. Rental packaging reads “Available for Rental Only.”

Starting March 31 with Marley & Me and Oscar winner Slumdog Millionaire, distributors will be authorized to only ship separate rental and sellthrough Blu-ray and DVD copies to dealers based on their business model.

For example Marley & Me will be available as a special edition DVD with digital copy, DVD with special features, and DVD rental with special features. 

The Blu-ray three-disc sellthrough version features the BD edition with special features, the DVD edition with non-BD special features, and a digital copy disc. The rental Blu-ray release includes only special features.

Additional releases earmarked for rental/sales demarcation include April 7 The Day the Earth Stood Still, April 21 The Wrestler and April 28 Notorious and Bride Wars.

Special features vary by title, rental or sellthrough.

In a letter to distributors, Don Jeffries, SVP of sales at Fox, said the separation afforded rental customers a “theatrical experience,” while sellthrough offered a “premium product” that expanded the entertainment experience to further “enhance ownership.”

To Bill Burton, president of National Association of Video Distributors, whose members include Alliance Entertainment Corp., Baker & Taylor, Ingram Entertainment and WaxWorks, Fox’s decision only enhanced discord.

“Some of the board members have expressed concern with it,” Burton said. “It puts distributors in the position of being the police on this, and they are rather uncomfortable in that role.”

Specifically, Burton said distributors don’t want to be put in the position of deciding which retailer gets what type of title, or ship the wrong title to a retailer.

“It’s just bad news,” said a distributor who wished to remain anonymous.

The distributor said Fox’s plan would significantly increase the number of SKUs and paperwork needed to track inventory, a reality few relish given the economy.

It envisions real problems arising with Blu-ray whereby the sellthrough edition also includes the DVD and digital copy, while the rental edition doesn’t. The distributor said rentailers would be encouraged to go to Wal-Mart (which it said gets better pricing) and buy the titles at a lower price.

“Then they will have a BD copy to rent, a DVD to rent and digital copy,” the distributor said. “It’s just a better value. We’re trying to get Blu-ray out there, and this is just a slap in the face.”

A Fox representative was not immediately available for comment.


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