2006 Year in Review: OCTOBER
1 Jan, 2007
By: Thomas K. Arnold
Third-quarter results show a narrowing of the home video spending gap to just 1.6% from last year, an indication that the packaged-media business may be on the road to recovery. DVD shipments through the first nine months of the year are actually up, with the slight consumer spending dip attributed to price erosion at retail. The fourth quarter, meanwhile, gets off to a rousing start with reports that week-one releases of X-Men: The Last Stand, from 20th Century Fox, and a “Platinum Edition” of The Little Mermaid, from Buena Vista, generate $80 million in consumer spending in a single day.HD DVD backers now have a video game “in” of their own: Microsoft puts a $200 price tag on an external HD DVD player for its Xbox 360 video game console, which is on track to ship in November, bundled with an HD DVD copy of King Kong. Failing to find a buyer, Tower Records and Video stuns the industry by announcing it is shutting down. The winning bid for the bankrupt chain came not from Trans World, which had been the favorite, but inventory liquidator Great American Group, which weighed in with $134 million. Going-out-of-business sales are expected to commence this month. Home Media Retailing holds its fourth annual TV DVD Conference, and the big news is that the lucrative TV DVD category continues to outpace the rest of the industry in terms of growth. Data from The NPD Group shows that while DVD sales are up 4%, TV DVD sales are up 20%. Also at the conference, Jack Klugman and Robert Conrad are honored with TV DVD Lifetime Achievement Awards, and seasons five and six of “Seinfeld” win the coveted best of show award at the third annual TV DVD Awards. Worried about competition from digital downloading, Target Corp. president Gregg Steinhafel sends a terse letter to the Hollywood studios, insisting they provide equitable pricing on DVDs with movie downloads or else face less support from Target for their DVDs. Target also begins carrying both high-definition disc formats, with dedicated HD DVD and Blu-ray Disc displays in the DVD area. In a deal reminiscent of News Corp.'s purchase of MySpace, Google buys YouTube for $1.65 billion in stock.
The DVD release of X-Men: The Last Stand helps to generate $80 million in consumer spending in a single day.