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Time for a Business Reality Check

18 Feb, 2005 By: Thomas K. Arnold

Eric Doctorow said a most interesting thing the other day at the Ventura Summit, where executives with 17 of Ventura Entertainment Enterprises' owned or distributed labels huddled with key retailers for three days of schmoozing and strategizing.

“We're not in the movie business — we're in the packaged media business,” said Doctorow, the longtime head of Paramount Home Entertainment who last October was tapped as Ventura's COO.

I haven't heard those words in a long time. Years ago, when home video was still all VHS and the industry's top executives had come to Hollywood after selling refrigerators and air-conditioners, everyone seemed to accept that they were in the business of selling packaged goods to consumers, not making movies.

The arrival of DVD and its almost sexual lure to Hollywood's creative community triggered a massive mindshift in home videoland. All of a sudden, our executives were in the movie business. They began asking for, and getting, the power to greenlight films; then, when home video revenue to the studios finally surpassed theatrical in 2001, our once-humble execs fancied themselves a new breed of mogul, the modern-day Lew Wassermans who drove expensive cars and went to cool parties.

Heck, they even launched gala DVD launch parties that rivaled the most glitzy Hollywood premieres. And according to one story still making the rounds, a certain home video division president, who shall remain nameless, once proclaimed himself “the most powerful man in Hollywood” to a starstruck cadre of Japanese consumer electronics dudes.

Thanks, Eric, for bringing us all back to reality. Yes, DVDs are a lot cooler and sexier than those god-awful videocassettes, and they certainly have been embraced by directors, talent and the rest of the creative crew. But come on, guys — where does the average Joe get his DVD? At Wal-Mart or Target, right down the aisle from toothpaste and toilet paper, and right alongside printer ink cartridges and batteries.

It's not surprising, then, that niche and genre product is flourishing on DVD as it never did on VHS. Back in the cassette days, our business revolved around selling used movies. Now it's all about selling a diverse range of programming, from old TV shows to concerts, from stand-up comedy to cartoons, from Tae-Bo to Tai Chi.

Yes, movies are a big chunk of the business — and by far the greatest source of revenue and consumer spending. But when you get right down to it, DVDs are little boxes of stuff — stuff you buy and take home in the hopes that it will make your home life a little easier, a little more fun, a little more convenient.

Just like a book, a picture frame or, yes, a four-pack of Charmin.

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