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Pay-Per-View Succumbs to the Lure of Special Features

4 Jul, 2002 By: Holly J. Wagner

Special features like deleted scenes, outtakes, making-of features and other extras – once a unique selling point for DVD – have grown too popular for pay-per-view (PPV) providers to ignore.

Until a couple of years ago, folks ordering PPV movies got the film alone. But as consumers get spoiled to the goodies they could once find only on DVD, PPV providers have caught on and begun offering them regularly with movie purchases.

“We do it because we feel it's something the viewer might like. It's different from something that Showtime and HBO might do and it helps keep relationships with the distributors,” said Jonathan Shair, VP, Program Planning and Scheduling for Starz Encore – the only PPV provider that has no studio sister company. “Pay TV is about satisfaction. We really do feel it helps to differentiate the service. Especially with older movies that have been aired before, it gives them something new.”

Shair and his counterparts see the extras as a way to attract customers, forge relationships with studios and, sometimes, gain exposure for their independent featurettes in two-way relationships.

“We've always tried to offer that to differentiate pay-per-view from theatrical and home video. In some cases we would get material, outtakes or something, that is not available on home video,” said Richard Wellerstein, VP, Theatrical Programming and Acquisition at In Demand.

“It was not so much thinking about the DVD market as giving our customers a reason to order something they have seen somewhere else,” said Michael Thornton, SVP Programming Acquisition at DirecTV. “Whether you are selling a DVD or pay-per-view, you're looking for something extra to help sell to the customer.”

But while the extras on DVD may fill more time than the feature, PPV programmers view them more as a bonus that fills the time between the end of the movie and the next start time.

“The model in pay-per-view is, the more plays, the more buys. “It's a balancing act. Do we play it a few more times per day or do we give people something they can only see on pay-per-view?” said Wellerstein “Being in a scheduled business, films that come in at 95 minutes, you can't put that in a 90-minute block. You have to do something with the other 20 minutes. You can either promote or you can put in the electronic press kit and deleted scenes.”

As a result, PPV providers often cherry-pick extras to fit the time they have and the audience they anticipate.

“With Hannibal it was the second ending. With Rush Hour 2 it was the outtakes because they knew they would be funny,” Thornton said.

The time element also means video dealers need not fear that PPV will cannibalize their advantage.

“If you look at a movie's revenue stream the ancillary revenues from the video are where the bulk of the money is,” Thornton said. “Pay-per-view is a distant number in all of that. It's difficult to get the attention of studios but we still think it is an important part of the business.”

(PPV executives at Universal, 20th Century Fox and New Line did not respond to requests or declined to be interviewed for this story.)

Although Disney initially approached Starz Encore with the extras for The Sixth Sense, Shair began pursuing them on other titles after that.

“That stuff, when it's made, is usually made for home video, at the time it's made they are not approaching talent to clear stuff for pay TV,” Shair said. “We have become more aggressive about asking. We found it did not translate into automatically getting that material. What we are starting to do is hopefully have a relationship with the distributor when they will hopefully get those rights for us.”

That relationship can be a two-way street. It's not unusual for cable or pay channels' featurettes to show up on DVDs. HBO's “First Look” featurettes are not unusual on Warner titles and Starz, with no studio arm, is working heighten its profile by partnering with smaller suppliers.

“New Line, Miramax and other channels are starting to do that. It's [our] effort to develop the relationship with home video,” Shair said. “Serendipity will include Starz Encore ‘On the Set' segments. We want those on the DVDs whether to not they give us anything.”

PPV executives know the extras may attract some viewers, but not enough to offer them as a separate purchase in most cases.

“A couple of times we've run the extras separately to try to sell the movie. On Legally Blonde, we sold the extras for a penny to try to promote the movie. The idea was ‘let's make it very accessible.' They had to order it as an impulse,” Thornton said, noting that although DirecTV has no test bed to measure results, “Legally Blonde was a very successful title for us in comparison to what it did theatrically.”

Partly because extras are so popular and partly because DVD is too profitable to ignore, DirecTV is considering offering a DVD as part of or an add-on to PPV sales. Although Thornton was not ready to disclose titles, he said DirecTV is looking at that and other ways to turn extras into cash within the time-block business model.

“It's all possible. It's a question of bandwidth,” Thornton said. “When we look at a movie, we look at how much is remaining on that half hour. We have not really seen extras that make it worth going into that next hour.”

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