Insights from home entertainment industry experts. Home Media blogs give you the inside scoop on entertainment news, DVD and Blu-ray Disc releases, and the happenings at key studios and entertainment retailers. “TK's Take” analyzes and comments on home entertainment news and trends, “Agent DVD Insider” talks fanboy entertainment, “IndieFile” delivers independent film news, “Steph Sums It Up” offers pithy opinions on the state of the industry, and “Mike’s Picks” offers bite-sized recommendations of the latest DVD and Blu-ray releases.
While reports and speculation about retail performance are staples of every holiday season, this year's reports have been more of a mixed bag than in previous years. In fact, they look a bit too much like the Scarecrow in The Wizard of Oz giving directions by pointing in opposite directions at the same time.
Every week brings a new report about how consumer confidence is up, no it's down but we're expecting improvements in the job market; but whoops! employers trimmed their payrolls again and the “recovery” is even more jobless this week than last.
In the midst of all that retail has been this year's barometer. It's become almost a mantra that home refinancings have put money into consumers' hands and spending the profits has kept the economy afloat, a cycle economists have warned can only hold up for so long.
This week's update from UBS Warburg and Bank of Tokyo-Mitsubishi notes chain store sales were down 2.3 percent in the week ended Dec. 7, which seems to bear out last week's conclusions. The report offered this bitter assessment: “It's beginning to look a lot like Christmas, as the saying goes, but unfortunately, right now it is looking a lot like Christmas 2000 – which was a dismal retail season.” The analysts predict the best of this holiday season is already fading in retail's rearview mirror.
While cheap DVD players are chumming the software feeding frenzy this year – and video retailers are right to get it while they can – they are also foolish to think that can go on forever. Consider writer Igor Greenwald's commentary for Smartmoney.com:
“A year ago, 25 percent of U.S. households owned a DVD player, according to one survey. That figure could well double by January as the DVD tries to almost single-handedly save Christmas. But what about next year? God forbid some bank should order up a million cheap freebies to lure credit card borrowers: Some DVD players are already as cheap as toasters.”
By itself, that may seem like a warning that would benefit software retailers at the expense of hardware vendors, but it's only part of the picture.
Software retailers can count themselves lucky this year, but even with a big, happy bump in DVD-enabled households, combined DVD and VHS rental spending for November was down 22.2 percent from the same month last year (and more than 11 percent year-to-date). The rental bug is hurtling toward an end that's starting to look a whole lot like sellthrough's windshield.
Increasing DVD penetration is a boon for our industry, but like all good things and like the dot-com bubble of the 90s, this too shall pass. Anyone who thinks their business can survive on rental alone might as well click his heels together three times and chant, “There's no place like rental…”
20th Century Fox Home Entertainment's has cancelled its “Five Star” line of beefed up DVDs, but the move actually is evidence of the popularity and ubiquity of extras-packed discs, rather than an indictment of them.
Special editions are not quite so special any more. Studios have done a great job of offering numerous extras to consumers at a reasonable price, pulling out all the stops to produce a truly fine product on catalog titles. In fact, the product is so desirable that catalog titles can often be treated like new releases, with the event marketing to back them up. Studios don't need a special line to call attention to great DVDs. The titles speak for themselves.
“We can move on to producing catalog [special editions] as event releases in their own right rather than as part of a collection,” said Fox SVP of marketing Peter Staddon during a n online chat with the Home Theater Forum.
Many marketing execs have noted that catalog titles on DVD have all the punch of new releases. Witness the special bashes thrown by Paramount for “The Godfather Trilogy” and Grease, and by Artisan Home Entertainment for Reservoir Dogs. In the old VHS sellthrough days, a spccial line and flashy silver packaging seemed to add value to the cassette. DVDs simply don't need it; they stand on their own.
With our time to enjoy the holidays increasingly crimped by workload and commute times, we are even more, I think, looking to movies to help us get a quick fix, a jump start to generating that good old holiday cheer. And nothing beats home video for delivering the films we grew up on and have become part of our holiday ritual.
Last week I performed one of my own holiday rituals that never fails to get me into the mood. I sat down and watched White Christmas on video. Most years I have watched it by myself, since I am the only person in the household who can't get enough of Bing, Danny and those Hanes sisters. This year, however, I found that a neighbor buddy of mine was also somewhat fanatical; about the film (he even has a tree ornament of the White Christmas quartet), so while our wives were watching something typically grim on the Lifetime Channel, we two he-men settled into the couch for a rousing time of singing and dancing (OK, really, we just like to watch the very lithe Vera Ellen strut her stuff) and mountain lodge horse play leading to that ultimate moment when the fellows' Army unit comes back for one more salute to “the old man.” It just isn't Christmas for me if I haven't seen it at least once a year during the holidays.
Alright, I'll admit it's a little weird, this compulsion to watch White Christmas, but hey, it could be worse! I could be daft over Ernest Saves Christmas which, according to a recent poll by the sellthrough chain Suncoast, was overwhelmingly voted as the worst holiday movie ever made. The chain surveyed some 2,400 people across the land and they found that men and women tend to differ on the absolute favorite holiday film. (My wife, for instance, can take or leave White Christmas, to my utter astonishment. Her favorite, and it's a good one, too, is The Santa Clause.)
Maybe typically, the movie most men voted as their favorite holiday fare was National Lampoon's Christmas Vacation. Hmm…, that does indeed express the pain and agony of the holidays. For women the answer was the classic It's a Wonderful Life. No surprise there. The best animated movies ever both men and women agreed, was How the Grinch Stole Christmas.
The fact is that everyone has an opinion about a holiday film and likely will go out of their way during the holidays to see it. It's always a happy holiday for the video business.
By: Kurt Indvik
I'm getting calls left and right from the national media, which all of a sudden seems to be “discovering” DVD — and concluding that it's not a fad, after all.
The New York Daily News did a story, using our research, on how DVD is leading to bigger and bigger video sales. The Buffalo, New York, newspaper followed, with the reporter asking me to quantify how big DVD has become.
Other metropolitan papers around the country have also been calling about DVD and I recently finished a radio interview with a news-talk station in the Big Apple on the DVD phenomenon.
Now, I hear the New York Times is working on a story with a futuristic slant, focusing on DVDs, like Unfaithful, that contain alternate endings.
Quite frankly, that's my favorite special feature of them all. I like having director commentaries and music videos, but I don't generally watch them, unless I'm really into the movie.
But I do make it a point to run through all the outtakes and deleted scenes, and on the rare instances when I come across a DVD with alternate endings, I'm in heaven. Deleted scenes can really change the way you view a movie; alternate endings can actually change the movie.
But as much as I enjoy them, I am also realistic, and believe that alternate endings will never be the Next Big Thing in the special features department.
Adding a different ending or two would change the story from what they released to theaters. After the pre-theatrical release focus groups settle on an ending, Hollywood types hate to change them. Heaven forbid fans prefer one of the alternate endings to the one from the theatrical version! What would that do to a fragile Hollywood ego?
If there is a trend in the development of special features, I think you have to go back to what Disney's Bob Chapek said over the summer at our DVD at 5 conference — that instead of more special features, you're going to see better special features.
DreamWorks takes the cake on this one, with the delightful “make a movie” feature on Spirit. This is one of the most entertaining and innovative extras I've seen, and definitely shows they put some thought and creativity in assembling this DVD.
With that in mind, here's a list of some special features I'd like to see on upcoming DVD releases.
The Ring — This one's a no-brainer, as far as I'm concerned. Slap the deadly videotaped film on as a standalone featurette, then issue a special/deluxe/collector's/whatever edition that includes the original Japanese version, and then maybe even a four-disc set with all three Japanese films (the original, along with the prequel and the sequel). Four discs might sound like a lot, but hey, if it worked for Pearl Harbor…
8 Mile — An Eminem concert video.
Harry Potter and the Chamber of Secrets — More set-top games, a tribute to Richard Harris and a virtual reality flying car.
My Big Fat Greek Wedding — An interactive recipe guide to some of the fabulous food served at the wedding, and a minidocumentary on Ouzo and maybe a Web link (sponsored, of course!) to order some online.
Die Another Day — An interactive Aston-Martin dashboard that lets you put yourself in the action and control the car through some of the scenes, and a documentary on the Bond girls through the years.
That's it. If any studio wants to offer me a marketing job, you know where to find me.
By: Thomas K. Arnold
Well, Black Friday is behind us and so far, retailers are reporting strong sales. On the other hand, economy watchers are saying shoppers are in mid-holiday-season mode (The Natoinal Retail Federation reported that 8.2 percent of consumers it surveyed were finished with holiday shopping by Monday and most shoppers have completed 38.7 percent of their shopping already), rather than at the starting gate, prompting some to suggest the best is behind us for this year.
DVD is in a strong position regardless, if only because of the deals available. Wal-Mart was offering selected catalog titles at two for $10 over the weekend. At that price, it doesn't pay to rent.
That's partly because DVD's durability is creating a whole new economy in used product. I'm not talking about the $9.99 “pre-viewed” (marketing spin for “thrashed”) copies from any of the rental chains. I'm talking good, old-fashioned used, as in someone else owned it, got tired of it and sold it.
This creates a parallel economy. Most stores that buy used DVD advertise it like a pawn shop: “Need some quick cash?” query the flyers at the counter and posters on the windows. “Sell us your old DVDs!”
That limits the long-range value of big titles because the studios have gravitated toward saturation marketing at street date and retailers have followed by making this week's title the loss leader. New DVD copies of Spider-Man were going for $13.88 on eBay's Half.com in the title's first week of video release.
Apparently not everyone who gets the hot new title wants to keep it. I was in a Wherehouse a couple of weeks ago and noticed a couple of things.
One big lesson is a new holiday paradigm: buy new for gifts, used for yourself.
I saw this when a customer went to the counter to trade off three used titles for a new one, a standing offer (within stated limits) at Wherehouse. The salesperson scanned the new title and offered, ever-so-helpfully, “We have this used…” The consumer chose new, explaining it was a present.
The chain has a limit of three of any title in the used bin at any given time. The shopper I observed was unable to trade off copies of Harry Potter and the Sorcerer's Stone and Hannibal because the store had already caught its three-used-copies per store limit. Which changes the DVD life cycle equation, at least for the consumer.
Now, if we really want to open a can of worms, we could ask whether studios count those resold copies in their sales figures…
Share your thoughts on the new DVD economy by clcking on Buzz Back below.
Among the biggest retailer pet peeves are street date violations. Studios often claim that violations are spotty and unintentional, but they certainly seem to persist.
Over the Thanksgiving weekend, I got to talking about DVD with my neighbors and learned that one mom had already picked up a copy of Lilo and Stitch from a mass merchant.
Being in the industry, I was aware that the title wasn't due to be sold until today, Dec. 3. What surprised me was that the purchasing mom knew it as well. It was only the clerk who seemed in the dark about the street date issue.
“I knew she wasn't supposed to give it to me, but they were out of the title I wanted, so she offered it to me instead,” the mom commented. Happy to receive the title early, the mom didn't enlighten the clerk.
Street date violators often mount the “uninformed clerk” defense, but I, for one, find it to be a bit of a stretch. If a harried suburban mom can keep the dates straight, why can't the store clerk? The clerk's job is stocking and selling the correct inventory.
While generally ignorance of a law is no defense, it's the common one for street date violators. And until the studios assess some real punishment for violations, it seems certain clerks will continue to ignore the calendar.
There was a recent item in the trade news about ad-skipping on personal video recorders and how this trend is causing advertisers to dramatically rethink their whole approach to broadcast advertising. And with advertisers looking to spend that money elsewhere, I wonder when and how some of those dollars might end up on DVD?
According to a survey of major advertisers conducted by Forrester Research and the Association of National Advertisers, 75 percent of national advertisers said they will cut their TV ad spending because of ad skipping taking place on the nearly 2 million PVRs already in U.S. households. Also, 75 percent of those national advertisers said they would be cutting their ad budgets by as much as 21 percent to 40 percent.
While this reaction may be a bit over the top, considering the small percentage of homes with PVR, the message is clear: Consumers faced with traditional advertising in an interactive environment such as PVRs (and the Web) will choose to not interact with that advertising or avoid it altogether.
I can't help but think that somewhere, someone is trying to develop an advertising model that works for DVD, especially in light of the growing trend of consumer goods companies participating as marketing partners in home video.
So far, studios have not attempted to place advertising on discs for fear of ruining the commercial-free experience. The endless trailers of upcoming studio theatrical releases can be skipped, although several studios are guilty of making that maneuver maddeningly difficult, even to the extent of causing one's DVD player to freeze.
There were a few early attempts at placing ads on VHS movies — Top Gun and Pepsi is a good example — but the concept never got much traction in the industry after a fair amount of consumer backlash at having to view commercials on what they thought was supposed to be a theater-like experience. However, interestingly enough, advertising on home video is fairly common in Europe.
For advertising to work in an interactive environment like DVD, it has to be part of the environment and more closely linked with the content. And by this I don't mean more creative product placement in films, which is now becoming more and more obvious.
If studios and marketers are looking for ways to capitalize on the entertainment platform of DVD with paid-for marketing partners (short of selling logo plugs on DVD menu pages, etc.), they will need to explore the opportunities to create sponsorships of special features or other value-added content that the sponsor can benefit from being attached to. This approach will be a challenge in that the content has to be truly meaningful to the film, yet offer some promotional opportunity at the same time.
As DVD grows, we can expect to see some attempts in this vein.
By: Kurt Indvik
We're seeing two different strategies when it comes to studios marketing their DVDs: dump and run, and product management.
The dump-and-runners — we all know who they are — flood the market with their latest big theatrical DVD releases and hope the sheer ubiquitousness of their product will boost sales. The down side is that in some areas they may run out, while in others they have a big surplus — but in the end they hope it will all shake out and, besides, there's a minimum of tracking and paperwork.
The product managers carefully analyze each market and ship accordingly; then, when a retailer runs out, they immediately ship more. Stores are not flooded with their product; the product goes where it will sell and then gets replenished. The down side here is that this can be a taxing proposition, with a lot of analysis and research — but in the end returns are minimized and that alone is worth the hassle.
Each side says their approach works better to achieve the end goal: maximizing sales. And it's interesting to note that while last year studios were crowing about first-day and first-week sales numbers, this year the battle for bragging rights seems to be around first-day selloff, with DreamWorks maintaining Spirit's selloff rate of 29 percent was much better than anyone else's.
What's interesting about all this is that no one's even mentioning rental. Studios are infatuated with the new collector mentality among consumers; rental is almost an afterthought. Whereas we used to hear studios boast about prebook numbers on hot rental titles — remember the Pulp Fiction versus Die Hard battle of a few years back? — or even first-week rental proceeds (the notorious Green Mile versus Sixth Sense scuffle), the studios' sole concern these days appears to be what consumers are buying and how much of it.
This, despite the fact that most video sales to rental dealers are through revenue-sharing programs, which you'd think would give the studios more of an incentive.
But this just shows you how times have changed. This business was built on rental and now no one cares. Even Blockbuster says it wants to make a big push into sellthrough, while limiting rental to monthly subscriptions (my interpretation).
As a result, terms like “turns per copy” have lost their relevance. Whether this trend continues into the newyear, with video rentals ultimately ceding the transient portion of the home video business to video-on-demand or rental will stage a comeback, remains to be seen.
By: Thomas K. Arnold
I've written before on how I am clearing out the junk vault (aka garage) by putting stuff on eBay. It's liberating to pack stuff off to happy buyers and that isn't an accident, it's a life stage.
Our society is built around ownership. I believe that's one of the pillars of DVD's success – it's priced at a low entry point so lots of people can get in on it. But there's more to it than that. Marketing gurus measure consumer life cycles like release windows.
The theory goes that consumers are buying goods in their 20s and 30s; then in the 40s people have made most of their major hard purchases and there's a shift to buying services. Finally, at whatever is retirement age, thery go to "buying experiences" -- gourmet food, travel, Broadway shows and spa weekends.
DVD straddles those boundaries.
I was exchanging Christmas lists with family by e-mail the other day and my sister-in-law Lisa inadvertently summed it up: "DVDs are the best gift for me since I can't think of much else I want or need." She and I are great fans of horror movies from classic to schlock, as well as what I like to call Train Wreck Video -- movies so bad you have to watch, like anything by Ed Wood. (Movies so bad Image has an awesome boxed set called The Worst of Ed Wood, which they tell me is a "perennial favorite," no doubt because of people like me and Lisa.) We speak a common movie language.
My dad is another story. I put him onto eBay in the hope he would follow my lead and clear his junk vault, but so far he's only buying. I think he's trying to preserve his youth and avoid confronting mortality through acquisition, an almost superstitious belief that as long as he has things to do and watch he can't get sick or die.
Maybe he'll come around. But in the meantime, his latest purchase was a DVD player, his first real foray into 21st Century home entertainment technology. Probably the best I'll get in the way of his following my leads. Then again, I partly got the schlock horror and creature feature thing from him.
See what I mean? One thing we all have in common is consuming home entertainment. Even those of us who are sliding out of the major purchase stage can appreciate a slender little disc with hours of diversion on it. It's compact and it covers all the consumer bases: it is all at once goods, a service and, if it's done well, it's an experience.
There are few movies that leave viewers more curious than before they've seen them, making them perfect for DVD. The Blair Witch Project was one; it had viewers going online before and after seeing the flick for clues in the faux mystery. The Sixth Sense also prompted viewers to watch the film again to catch all the hints they missed the first time around.
This year's hit The Ring has characteristics of both movies, as well as such scarefests as The Exorcist. It's got an online component (take a look at themorganranch.com) and a surprise ending that prompts viewers to want to watch the film again. It's chock full of mysteries that have elicited more than one conversation with friends about what they thought they saw and didn't see. It's also got a Japanese predecessor, Ringu, with some plot twists not included in the American version from DreamWorks.
Happily, all this adds up to what promises to be a great DVD. DreamWorks holds the rights to Ringu, according to a spokesperson, which should make for a great combo with The Ring. I've seen the original and both films have uniquely scary characteristics. The final appearance of the girl in Ringu is not to be missed.
Since the plot revolves around an investigation of historical newspaper articles and the famous “student film' videotape, the background clippings and ancillary video material possibilities are numerous. Any commentary, especially one explaining the choices made for the American version, would be engaging.
While DVD viewers will be denied the chill of watching the film on videotape (for those who haven't seen The Ring, the plot involves a cassette that kills those who watch it), The Ring is remarkably well suited to the extra elements a disc can offer, including slow-motion and pause capabilities.
Suffice it to say, this jaded video journalist can't wait for The Ring DVD, which means fans will be clamoring for it. DreamWorks may have been a bit surprised by its theatrical success, but here's hoping they'll be prepared and pull out all the stops for the video release.