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How A Magnetic Personality Launched An Industry

24 Nov, 2002 By: Kurt Indvik

Tomorrow marks the 25th anniversary of the home video industry. It's pretty unusual for any industry to be able to pinpoint its start to the day, but Nov. 26, 1977, is the day on which an ad appeared in TV Guide offering Hollywood movies (in this case all from Fox) for sale on VHS cassette for just $49.99. The ad was placed by Andre Blay and his newly formed company Magnetic Video, which had licensed for home video 50 Fox titles, an act that earned him the right to be called “the father of home video.”

“People were absolutely smitten with the idea that they could buy movies,” Blay told Video Store Magazine. So smitten, he said, that of the 12,000 people who responded almost immediately to Blay's ad, sending him $10 to join a subscriber's club from which they could acquire these videos, about two-thirds of them didn't yet own a VCR player.

Ah, but the birth of the home video business was really a story of twins, because not two weeks went by before another ad appeared Dec. 6 in The Los Angeles Times, this one placed by a man who previously had rented super-8 movies and projectors to show them on, quietly announcing the availability of video titles for rent. Yes, George Atkinson had bought tapes from Blay and decided that maybe people would rather rent them than buy them.

There is a quote from Abigal Van Buren (Dear Abby), that goes, “It is true that I was born in Iowa, but I can't speak for my twin sister,” that speaks somewhat to the different paths rental and sellthrough have taken since their almost simultaneous appearance. Rental, for a lot of reasons including consumer choice and studio pricing, has been the sibling that built the multibillion –dollar home video business over the past quarter of a century while sellthrough was pretty much left to evolve slowly from its historical roots of special interest and kids video.

But along comes DVD and now, five years later, consumers are once again smitten with sellthrough and building a collector's mentality in the marketplace. In every family every sibling enjoy periods of bounty and hard times and Blay, who said he still believes sellthrough is a better business because “people like to build libraries,” can take a measure of satisfaction all these years later.

As for the business that Atkinson started, while rentals are already showing a decline this year from last, there are those industry observers who feel that as penetration of DVD continues into the second 50 percent of U.S. households, rental will see a resurgence and, with a healthier sellthrough business as well, the home video business will be one bigger happy family.

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