Monday, December 15, 2008
By Thomas K. Arnold | Posted: 10 Dec 2008
Can Batman save the home entertainment industry?
In a season of hit-or-miss theatrical blockbusters, where some of the misses have been by as much as 30% off target, Warner Home Video’s The Dark Knight landed squarely on the bull's eye, selling more than 3 million units its first day in stores, 600,000 of them on the high-definition Blu-ray Disc format.
That sets the stage for the Batman sequel to become the top-selling home video release of the year, mimicking its performance on the big screen, where its domestic gross of $530.3 million stands unmatched by any other theatrical release in the past decade.
“We were extremely pleased with first day sales, and we now think it will easily be the biggest title of this year in home video,” said Ron Sanders, president of Warner Home Video.
He notes that the Warner number includes sellthrough only in the United States, Canada and United Kingdom; sales to rental dealers are not factored in.
Sanders also projects that the Blu-ray Disc sales tally alone could rise to 1 million units by Saturday. “In the first two days across those three territories, Blu-ray Disc sales are running between 25% and 30% of total sales, which is a massive number,” he said. “We had expected Blu-ray to account for a significant percentage of sales, but not quite this high, which speaks well for the format. It’s really catching on with consumers.”
The previous Blu-ray Disc sales record was set earlier in the fourth quarter by Paramount Home Entertainment’s Iron Man, which sold more than 500,000 high-definition discs its first week. The Dark Knight shattered that record — in a single day.
“Blu-ray is clearly catching on with consumers,” Sanders said.
There are bigger implications as well. For the home entertainment industry, the DVD/Blu-ray Disc release of The Dark Knight wasn’t just about one title, albeit the biggest title of the year. It was more about the short-term future of the business.
Throughout the fourth quarter, studio executives, key retailers and analysts have been closely monitoring sales of the summer blockbusters. With total home video sales projected to be off by as much as 6% this year, the performance of the hits has taken on special significance.
Back when the DVD business first began to slow four years ago, the first cracks to appear were in the sales totals of the megahits, beginning with Shrek 2, which sold phenomenally well upon its November 2004 release — but not as well as DreamWorks had anticipated.
From that point on, the video-to-theatrical ratio for the big-screen blockbusters continued to decline — and, with it, the fortunes of the entire home entertainment business, which, like its theatrical counterpart, had grown increasingly dependent on the hits.
This year the fourth-quarter parade of summer theatrical blockbusters has had a spotty performance. Some titles, such as Iron Man, did exceptionally well; others, such as Indiana Jones and the Kingdom of the Crystal Skull, could have done better.
The day The Dark Knight went on sale, a Wall Street Journal article said the film’s home video sales performance would be a bellwether for the entire industry.
“When the Warner Bros. film The Dark Knight shattered box office records this summer, it was hailed as a sign that Hollywood can repel an economic downturn,” the article said. “But as that latest Batman installment is released on DVD … it could show that Hollywood’s defenses against a recession are crumbling. Batman’s fate in a declining DVD market will be just one way the movie industry’s claim of being recession-proof will be tested.”