New Line Exec: Won't <i>Lord</i> Over <i>Potter</i>7 Aug, 2002 By: Bruce Apar
The Lord of the Rings supplier New Line Home Entertainment isn't playing the industry game of lording unit shipment numbers over other suppliers. At a Central Park party-on-the-lake replete with smoke effects, laser lights and 20 boats to launch the video release, Stephen Einhorn, president and COO of the AOL Time Warner division, told Video Store Magazine he anticipates the company's wholesale revenue from VHS and DVD copies to match the film's theatrical box office take of $313 million.
"We won't ship as much as Harry Potter," he advised, referring to sister division Warner Home Video's recent release.
In addition to New Line Cinema chairman Robert Shaye, also on hand for the festivities, doubling as a benefit for actor William Baldwin's The Creative Coalition arts advocacy group, were New Line Home Entertainment senior VP of marketing Matt Lasorsa and senior VP of sales Pam Kelley. Along with Einhorn, they noted that the days of "front-loading" copies of a blockbuster title like LOTR are "obsolete." Kelley said the efficiencies of just-in-time replenishment at retail, with sell-off data updated virtually every hour, have replaced the old industry practice that used to be sarcastically described as "shipping platinum, returning gold." Suppliers routinely would manufacture more copies than the market could bear in order to maximize publicly reported shipment numbers, then much more quietly allow key accounts to return 20 percent or more of the copies for credit.
Einhorn explained a primary reason for the shift is a change in accounting rules that requires companies to immediately expense every copy manufactured, rather than defer expenses until unsold copies were returned to vendor. The new rule, said Einhorn, "is a real incentive not to over-manufacture."
Kelley added that shipping a six-week supply of copies nowadays is "absolutely ridiculous when you can ship a one-week supply and continually monitor for replenishment."
Lasorsa noted that the head of the production company that developed the DVD extras for Rings, Michael Pellerin of Curtti-Pellerin, is a "huge fan who can recite every word [Rings author J.R.R.] Tolkien ever wrote." That expertise brought an "insight to the movie we could not otherwise get," Lasorsa said.
After an "armada" of boats manned by hooded characters from The Fellowship of the Ring crossed the lake to meet a barrage of press photographers and guests, the crowd of about 200 saw a premiere screening of a 10-minute featurette included in the DVD, profiling the second film, The Two Towers, due in theaters this December.
Seen mingling were Rings star John Rhys-Davies (Gimli the dwarf), TV star Caroline Rhea of “Sabrina the Teenage Witch,” who next month takes over Rosie O'Donnell's daytime talk-show (and whose sister Cynthia is a marketing executive at HBO Home Video), and actors Chazz Palminteri, Marilu Henner, Richard Masur, and Richard Kind (of "Spin City").
Following Fellowship's DVD and VHS theatrical version's release will be a "special extended edition" streeting Nov. 12 that will run about 30 minutes longer than the theatrical cut and feature a new score.