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Rentrak Adds Sony/MGM Product to Rev-Share Business

8 Nov, 2005 By: Erik Gruenwedel

Rentrak Corp. in 2006 will begin offering Sony Pictures Home Entertainment (SPHE) product (including Metro-Goldwyn-Meyer fare) to its revenue-sharing clientele for the first time.

According to the Rentrak Web site, the Sony rev share program includes a $1.50 up front fee, with 39% of transactions going to the studio. There is an $8 guarantee requirement on all titles with a box office of more than $1 million, which could include the PVT sell-off, allowed after 29 days.

The agreement does not affect SPHE's ongoing direct revenue share contract.

SPHE has participated in pay-per-transaction (PPT) deals with Portland, Ore.-based Rentrak in Canada.

Rentrak second quarter (ended Sept. 30) revenues continued to be negatively impacted by the loss in rev-share revenue from Movie Gallery unit Hollywood Video, whose contract expired a year ago. Revenues were $20.1 million compared to $27 million last year. Net come was $1.1 million compared to $1.8 million.

Despite the $8.3 million rev-share loss (34 percent of last year's quarterly revenues) of Hollywood Video, Rentrak chairman and CEO Paul Rosenbaum said year-over-year PPT revenue was up 9 percent in the quarter based on revenues of $17.4 million.

“The Sony announcement is very good news for Rentrak going forward,” said Rosenbaum in a call with investors.

The company's nascent Advanced Media & Information unit, which consists of direct revenue sharing (DRS) programs with studios, box office and home video services, which includes the OnDemand Essentials media tracking service, generated $2.4 million in revenue compared to $2.5 million last year.

OnDemand currently has new 12 clients, including Viacom properties Paramount Studios, CBS, MTV, Nickelodeon, Noggin, The N, Comedy Central and VH1; and Expo TV, National Geographic Channel, NFL Network, and Ripe TV. Music Choice signed on last year.

Rentrak plans to launch an advertising tracking service in the near future.

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