Gone in 48 Hours18 May, 2003 By: Kurt Indvik
In a column for this space last October I wondered about what sort of business model might be necessary for studios to pursue using the Flexplay Technologies disposable DVD technology.
Well, come August we'll find out, as Buena Vista Home Entertainment embarks on a four-city test of the Flexplay EZ-D expiring DVD technology with eight of its titles.
Buena Vista isn't being specific yet on how these bare-bones discs will be priced other than to say that they will likely have a slight pricing premium over a typical video rental. And though no test markets have been announced, or participating retailers, Buena Vista does hope to test this concept across a broad demographic and through as many different retail channels as will take it, including, says Bob Chapek, BVHE president, video specialty stores.
According to Chapek, this test — and he's quick to say many times, it's a test — is not about seeking a new model to replace the current rental business, but to help the studio find a new revenue stream that doesn't imperil the current sellthrough or rental businesses. The intent, says Chapek, is to retrieve that lost rental customer who has gotten tired of that return trip to the video store, or paying the late fee when he doesn't make that trip in time.
Of course the devil is in a few major details, such as price and release schedule. According to Chapek, the idea would be that the titles typically selected for this sort of disposable platform, would be rental in nature, not major theatrical titles, and that they would not be released until about six weeks after the initial street date of the, er, permanent edition. In effect, it's an approach that allows consumers to rent a title from their usual home entertainment rentailer of choice when it first comes out or wait six weeks and grab it on their next visit or some other convenient location knowing they don't have to make the rental return trip.
Okay, there are many, many questions, and the test is designed to uncover the key retail pressure points, price being the big one for starters. Would a later window for this sort of product make this disposable DVD model palatable for rentailers? What about managing the balance between order quantities for the disposable version versus the permanent? Just how deep will non-video retailers be willing to stock these disposable DVDs?
I am sure we will all have plenty to talk about leading up to these groundbreaking tests. Look forward to hearing your thoughts.