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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.

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29 Jan, 2004

Let's Make a List of the Dumbest Moments in the DVD Business

Business 2.0 is out with its annual list of the 101 “dumbest moments in business,” and this year's installment contains some real doozies.

A few of my favorites:

* Seafood restaurant chain Red Lobster's “bottomless bucket of crab” promotion. It worked — too well: The company subsequently announced lower-than-expected earnings, with CEO Joe Lee noting, “It wasn't the second helping on all-you-can-eat, but the third.”

* Kraft's ad campaign to promote its new presliced, cracker-size cheese. The slogan: “We cut the cheese so you don't have to.”

* Urban Outfitters' Ghettopoly, a Monopoly knockoff. The top hat, shoe and car are replaced with a machine gun, marijuana leaf, basketball and rock of crack cocaine. Reacting to protests, the edgy retail chain promptly yanked the game from its stores.

* Sony filing an application to trademark the term “Shock and Awe” for a video game — just one day after the U.S.-led invasion of Iraq. Sony later pulled the filing, calling it an act of “regrettable bad judgment.”

Our industry didn't have any humdingers worthy of mention — or at least none that popped up on Business 2.0's radar. But over the years, we've certainly had our choice moments.

Who can forget the flap Free Willy caused overseas when marketers belatedly realized “willy” was slang for a certain part of the male anatomy?

Or the clear-as-day rendering of that same male part on the cover of the original videocassette release of Little Mermaid, cleverly hidden inside one of the castle spires? Disney denied it ever happened, but when Little Mermaid was reissued a few years later, the cover mysteriously changed.

We have some present-day issues the editors of Business 2.0 might also want to check out for possible inclusion in next year's list.

For starters, what could be a dumber moment in business than the decision by the big retail chains to sell hot new DVD releases for below cost their first week in stores, at a loss, when they could easily make a nice profit without appreciably affecting sales? I understand they want to drive traffic, and DVD is a most compelling lure — but why go so low? They're not only losing money, but they're also lowering the value of DVD in the consumer's mind — and those $5.88 catalog dump bins only make matters worse.

Then there's all that hard-to-remove tape on three sides of most DVD releases. Isn't shrink wrap enough? It's not only an annoyance, but it also can damage the cover art, particularly on Warner's cheapo cardboard “snapper.”

I also don't get the scheduling of TV DVD releases — and I'm talking about current series that are still on the air. Some “complete season” sets come out at the end of the old season; others come out at the beginning of the new season; some are a year behind; others two, three, four or even more. Take a cue from the networks: they all bow their new seasons in the fall, at the same time, creating anticipation and huge front-end viewership. Might not such a strategy work for TV DVD as well?

My “dumb” list doesn't end there. Let's also include listing Dolby and subtitles as “special features”; not including English subtitles on DVDs at a time when most Americans have come to expect them (and appreciate them, if they happen to have noisy kids and/or spouses); putting out crappy direct-to-video sequels with none of the original stars, another notch on the “devaluation” scale; menus on kidvids that don't automatically switch to play after a minute or two (my poor kids once spent half an hour watching the menu to some big animated feature, disappointed that nothing was happening); and separate units for full screen and widescreen, something that confuses consumers and really isn't necessary, given that you can easily put both versions on the same DVD.

Readers, I'd be interested to hear your own nominations for “dumbest moments in the DVD business.” Please e-mail me your suggestions, and we'll revisit this topic in a few weeks.

27 Jan, 2004

Look at Awards Shows as Glitzy DVD Promotions

As an avid hater of awards shows, I had to force myself to watch the Golden Globe circus Sunday night. But I know it's important to what happens in our trade over the next few months, so I took one for the team.

It turned out to be more interesting than I thought, but probably for the wrong reasons. I just caught up on some of the inside jokes and Hollywood gossip I would otherwise ignore entirely.

For example, at first I wondered why the always-adorable Renee Zellweger was looking so zoftig. Then I realized she had bulked up for the sequel to Bridget Jones's Diary, a snippet of dish I had read — sans pictures — a month or so ago. But we will all get to see the results later this year.

My viewing companion and I were trying to figure out if Mary Louise Parker had gotten a boob job, right up until she told the audience she had, sort of — courtesy of her newborn son. Bravo to her for proving that moms can still be hotties.

No such explanation for Al Pacino's garish shave. Besides the fact he looked like an unmade bed overall, when the cameras zoomed in on his rap it was clear that either he or his barber was inebriated when that goatee got shaved. He looked so bad the cameras cropped him out of the Angels in America ensemble shots.

I even felt sorry for Michael Douglas, who looked perplexed at the jerky video montage of his life's body of work, set to a rendition of “What I Did For Love.” While the sentiment might fit, the music was entirely the wrong rhythm and tempo for the clips. Douglas was visibly disappointed that his life was reduced to this. So was I, considering the opening red carpet montage was put together better.

I don't know how much a Golden Globe by itself helps a movie. I know that the more awards people see on the box art, the more likely many folks are to pick the title up to rent or buy it. So let the lovefests begin, it's all good for business.

25 Jan, 2004

What's Your Move With VHS This Year?

Ok, so we agree the future and the focus in home video is in and on DVD, but I'm going to be just as curious to see how the humble VHS cassette fares in 2004. I think this may well be a very telling year, indeed.

As I talk to studio and retail executives what I hear is still the same split personality response to the VHS question. In the one camp you have those who decry the premature abandonment of a format on which 40 percent of the country still relies to view home video. The other camp says VHS cannot support itself or justify its retail or warehouse inventory shelf space and will be virtually dead by the end of the year.

The early numbers don't bode well. According to Nielsen VideoScan, VHS unit sales dropped 44 percent in the first week of January this year compared to the same period last year. And VHS unit sales dropped a whopping 65 percent in the second week of January compared to the same week last year. While these numbers must be viewed as being indicative and not totally comprehensive, it is a strong market indicator of things to come.

If what I am hearing is right, and the above numbers seem to indicate a reality that is definitely upon us, here is what I think we could see this year.

--Studios will significantly increase the number of titles with a DVD-only release in 2004, primarily in the mid-level theatrical range of $0-$50 million and special interest and TV fare, certainly. Theatrical hits, childrens and fitness will continue to be offered in VHS, but we may see a few studios take up Warner's lead and decide that, like The Matrix Revolutions, it's only worth doing so at a rental price point. Sellthrough is DVD's domain, and even in previously viewed VHS commanded a 35 percent share in 2003, according to Video Store Magazine Market Research and that was with an average price of $7.80…a price point I bet was much lower by year's end.

Even the kids market and fitness have made great strides into DVD. Preschoolers now have a DVD they can “pop-n-play” thanks to Lions Gate Family Home Entertainment, avoiding the problem of menus they cannot navigate. And many fitness titles are using DVD technology to allow users to fashion their own workouts instead of following a linear program.

--Specialty retailers, pressured by a flat rental market will continue to dramatically reduce their VHS catalog space so they can devote that space not necessarily to DVD catalog, but to emerging opportunities in more previously viewed/used and new video sales and video game sales and rentals. An earlier survey of retailers by VSM Market Research indicated that 8 percent of respondents said they were planning on eliminating VHS from their rental business in 2004. I think it might be higher by year's end. And I think that the business of catalog rentals is going to be significantly impacted by the decent of the VHS format in 2004. DVDs in catalog rental have not performed as well simply because so many of the titles are available for sale at very attractive new and used prices for someone who really is a fan of a particular title.

I know there will be those pockets of the market that are not going to hustle VHS out the door as quickly, and I am still—in my heart of hearts, as I have been saying since I began writing this column several years ago—reticent about saying that retailers should be moving away from VHS with much haste. I'd be interested to hear from retailers around the country as to what they anticipate their moves will be with VHS in 2004.

22 Jan, 2004

DVD's Widespread Appeal Sets Stage for Sales War

It's funny how DVD has become not only the preferred way to watch movies at home, but also a bona fide pop cultural phenomenon.

Ads for DVD have become ubiquitous on television and in magazines. Top consumer newspapers like USA Today, the New York Times and the Los Angeles Times have launched dedicated DVD sections and special gift guides. And while the DVD market's overall growth rate is flattening out now that more than half of all U.S. households have at least one DVD player, most studio presidents with whom I've spoken recently expect software sales to continue surging upward for at least another two years — and by then we'll probably have a next-generation successor, and the process can begin all over again.

Unlike so many high-tech advancements, however, DVD is not just a guy thing. And that's a pronounced shift in the home entertainment business, which since day one has been geared toward males and only seen women as a conduit to sell or rent children's and family product.

This past fourth quarter, it became most evident that women were not only buying DVDs for their men and their kids, but also for themselves. There were inklings of this happening in previous years, but never was the point driven home so clearly as now.

As a result, you're seeing a big push for Valentine's Day. In years past, the focus was always on rental — rent a romantic comedy and watch it as a couple. This year, the mantra from the studios is sell, sell, sell. DVDs are getting pitched as a nonfattening, non-wilting alternative to candy and flowers. MGM, also on top of the game in packaging catalog titles, has put together a “contemporary romance collection” and will likely sell tons of product. Fox, too, has a Valentine's Day promotion in the works with 18 titles, from Moulin Rouge to Ever After. Universal has Lost in Translation and several other current titles it's pitching to sweethearts everywhere, while Disney is hot with Under the Tuscan Sun, starring the red-hot Diane Lane.

It's a precursor of things to come. The battle for DVD sales of hot theatricals this year is going to be brutal and cutthroat, and the only wiggle room is in nonhit fare — specifically, catalog and niche.

The big studios that have a lot of theatrical product coming their way will, of course, dump huge wads of cash into consumer advertising and marketing, and keep their fingers crossed that they break out ahead. But they'll depend heavily on nonhit product to break out of the pack.

The studios and independent suppliers that don't have much theatrical product in the pipeline are, in many ways, better off. They don't have to wage war on the front lines; they can devote all their time, energy and other resources toward crafting diverse release schedules and clever marketing campaigns to sell product that goes beyond the flavor of the week.

Hopefully both sides will end the year with a good taste in their mouths.

20 Jan, 2004

Does Bleeping Out Naughty Comedy on TV Sell DVD?

I think the cable networks may finally have discovered the ultimate weapon against home recording of shows: censorship.

I understand their need to keep prime-time programming clean enough for family viewing, but there has to be a limit.Over the weekend, I watched a couple of standup comedy shows on Viacom’s Comedy Central channel.

A few of these shows survived intact, but an astonishing number of them had visuals or sounds bleeped out.

I was a little surprised when one comedienne’s physical comedy included flipping the audience off, and the channel — perhaps at the insistence of my satellite provider, DirecTV — pixellated the obscene, although commonplace, gesture so home viewers wouldn’t be able to see it.

But by far the worst massacre of any program I have seen on the channel to date was Saturday’s broadcast of "Queens of Comedy," a 79-minute revue of female African-American standup comics.

Admittedly, the program, directed by Spike Lee and starring comics Miss Laura Hayes, Adele Givens, Sonmore and Mo’Nique, is a bit raunchy. But whoever was doing the audio bleeping on this program got completely out of control, obliterating so much of some routines that there was no point in watching the show at all unless the viewer was skilled in lip reading.

Now, this was prime time in California, but it was the East Coast feed, so it would have been showing as a late-night program back east.

I couldn’t help wondering: Is this a ploy to keep the channel in a basic cable/satellite subscription package? A new trend in family-ifying entertainment that was intended for a more mature audience? A teasing infomercial for the DVD?

The title has been available from Paramount Home Entertainment since Feb. 27, 2001, for $24.99. I didn’t see the overlay, crawler or spot for the title on DVD during the time I spent watching.

Personally, if I like a comedy program that is available on DVD, I will get it so I can watch it more than once. Comedy is a uniquely social event that lets us communicate with like-minded friends. More than with feature films, my brothers and I — as with most people, I suspect — pick up lines from routines we all like and use them to communicate in a form of shorthand or to reflect on experiences we shared growing up.

The editing completely destroyed the program, so I had to change the channel. With these cuts, it was just too much like watching a train wreck.

I don’t know what’s going on with Comedy Central (please write to me if you notice cable providers doing the same thing with this or any other channel), but intentionally or accidentally, it looks to me like a great pitch for the DVD.

By nature, we are creatures drawn to the forbidden. If I had this disc in rental stock, there’s a good chance I would promote it with some type of shelftalker advertising that it is the version you won’t see on TV.

Dangle that forbidden fruit, and I’ll bet people will pay to see it.

19 Jan, 2004

DVD Rivals the Theatrical Experience in My Book

The latest “Lord of the Rings” installment, The Return of the King, is very long (three hours plus), and despite the fact that my husband offered to watch the kids while I trekked to the theater to see it, I still decided against visiting the box office this weekend.


Honestly, I would rather wait for the DVD.

I know Return of the King has been widely acclaimed and has topped the box office several weeks in a row. It's also the kind of epic many think is best viewed on the big screen, but I think I would rather watch it in the comfort of my own home on my DVD player.

In the old VHS days, when the picture and sound quality just didn't measure up, bypassing such an epic on the big screen would have been unthinkable to me. But the home viewing experience on DVD is so stellar that a trip to the movie theater seems like a chore.

I'd prefer to watch it at home, where I can choose my own intermission and snacks, and can get up and walk around a bit.

As far as this moviegoer at least, the home video experience has begun to rival the big screen. The ‘Rings' numerous-hour extended editions are probably the best and most definitive versions of the trilogy, but they'd be a pain to view in a movie theater — even in the most comfortable of seats.

As ticket prices skyrocket along with the price of theater snacks, the DVD viewing experience looks better and better. At least one colleague has mused that home video may finally be taking a bite out of theatrical revenue — and, this weekend at least, I tended to agree.

18 Jan, 2004

Video's Bite Into Theatrical

Each month in Video Store Magazine we take a look at the upcoming month's slate of theatrical titles coming to video that generated at least a million dollars at the box office.

February's offering, as we point out in this week's issue, is woefully short of “event” titles save for Spy Kids 3-D: Game Over, which earned Buena Vista/Dimension more than $111 million. After that, the next biggest box office winner coming in February is Runaway Jury from Fox which earned a little over $49 million. There are a total of 18 titles that earned $1 million or more coming to home video in February, and this batch, as a total, generated just over $470 million in ticket sales.

By contrast February 2003's slate of 22 titles earned a more exciting $780 million, and included HBO's sleeper hit My Big Fat Greek Wedding among three $100 million plus titles that month.

By now you have heard that theatrical ticket sales and revenue dropped last year and there is certainly an argument to be made about a link between the escalating price of a movie ticket and the dropping prices of DVD as a factor in theatrical's poor showing. The result is that, more so than ever, good films, albeit not the kind that are “must see” on the big screen, are being hurt at box office by the “I'll wait for the video” effect.

So while this February's theatrical slate is by far smaller in box office power than last year's I think this year's February offerings, a terrific bunch of films, will perform better on a comparative basis. There are some strong films in this group, with major stars that received plenty of promotional push leading into the fall and have garnered, in some cases, great critical acclaim like American Splendor, due out next month from HBO, as well as Lost in Translation from Universal.

Along with the above mentioned titles consider Under the Tuscan Sun, Secondhand Lions, Matchstick Men, Intolerable Cruelty, The Missing, The Fighting Temptations. All films with major stars and plenty of promotion push.

While box office performance has always been the lead indicator of a video's potential success, home video's impact on theatrical may, oddly enough, skew those indications to a greater extent in the future. It'll be interesting to see if this effect occurs regularly over the next 12 months.

16 Jan, 2004

New DVD Households Are Hungry &mdash; <br>Feed Them Early, With a Feast of Titles

Think broad.

The fourth quarter of 2003 saw consumers spend around $4.5 billion on buying DVDs, and much of the money went to the big blockbusters that each week battled it out for supremacy on the shelves of the big chains.

If the studios learned a lesson, it is this: You had better take an in-your-face attitude toward marketing, because if you don't make a big splash the first weekend, you're likely not going to have a second chance. The concept of “legs” disappeared long, long ago — the days when a title, like the original Lion King cassette in 1995, could rack up strong sales for several consecutive weeks are over, and the new reality is that if studios don't sell at least one-third of their shipment by the first weekend, they're out of luck.

As a result, virtually every studio executive with whom I've spoken said consumer marketing dollars are headed for a huge uptick in 2004, and living or dying by the hits bears increasing relevancy. Just like in theatrical, there's generally only one big winner each week, and if you're sharing a Tuesday release date with two or three other heavyweights, as you're likely to do in the typically crowded fourth quarter, you need to do all you can to stand out and grab the consumer's attention so you finish in the money and not in a pickle.

The problem in this isn't just the risk inherent in a first-week battle of the heavyweights, but what to do when there are no heavyweights. Not all studios have golden runs, and if you depend entirely, or even mostly, on your parent company's theatrical slate, you wind up with very little control over your division's fate — and your professional destiny.

So in addition to upping the marketing ante next year, what I'm hearing from smart studio executives is the pressing need to broaden their product offerings. The feeling is that with buy rates still up in the 15- or 16-DVDs-a-year range for even the newest generation of DVD owners — the ones who weren't motivated to buy players until this past holiday season, when the price dipped to as low as $19.99 — the bottom isn't about to fall out of the sale market.

New DVD households are almost as hungry as their early adopter predecessors — and you'd better feed the kitty while you can. Observers don't forecast any significant drop in buy rates until penetration hits the 70 percent mark, and that's still about two years off.

In the meantime, the prevailing sentiment is to offer DVD consumers the widest possible assortment of product. And without giving away any secrets — a lot of these studio executives with whom I've spoken are fearful of word getting out about their specific plans for '04 — let me just talk in generalities about some of the trends and developments we're going to see in the coming year.

1) Short-form children's programming will continue its rapid transition from VHS to DVD. If you dissect their numbers, the Digital Entertainment Group (DEG) sees as many households buying a second DVD player this year as coming online for the first time. That means the old adage about the VCR moving to the bedroom, or the kids' room, is no longer correct — it's moving into the trash. And if you factor in the PlayStation 2 phenomenon and the anticipated growth in other ancillary playback devices, including DVD players in SUVs and minivans, there's a huge gaping market that won't be satisfied with the handful of features aimed at kids that are released on DVD each year.

2) TV DVD will continue to sail away. There are gobs of great stuff still sitting in the vaults, and consumer research has found that once you get into the habit of watching TV shows on DVD, you're likely to stick with it. Expect some shows you never thought would see the light of day — heck, maybe we're even in for a complete first-season set of that treasured Jerry Van Dyke classic, “My Mother, the Car.”

3) Old movies will come out in droves. A few years back, some studios put a temporary halt on pushing their catalog out on DVD because the price points were so low. They wanted to wait until the price went back up. Guys, that ain't going to happen. Prices have come down even more — and yet demand has gone up so astronomically that studios would be foolish to sit on the sidelines any longer.

4) Look for December 2004 to bulge with hot new releases. I remember lots of skepticism about Disney's decision to not issue Pirates of the Caribbean on DVD until December. “They'll miss out on sales” was the common refrain. Well, Disney sold 11 million DVDs in a single week and easily won the battle for fourth-quarter market share, while studios that pushed their hot titles out early suffered from soft sales. Guess who's laughing now.

5) We're going to see a uniform next-generation standard simply because we have to. High-definition is coming fast, and our industry can't afford to let satellite, cable, or even broadcast TV get it first. My money's on Blu-ray, a true next-generation format. I see a lot of pride-swallowing in the coming months, and an agreement by year's end.

I've got several other prognostications to make, but this column is running a bit long and I'd better stop. Perhaps I'll touch back on this topic in a few weeks. In the meantime, check out what's happening at retail this month. From most accounts, DVD sales never stopped soaring with the end of the holidays. And you can bet that the release slate for January 2005 is already taking shape — and it will have a lot more heavy hitters than this year's list.

One thing about our industry — we're fast learners.

13 Jan, 2004

Pirates of the Academy Screeners

Piracy is again the hot topic in Hollywood with the news of an Academy Awards screener of Something's Gotta Give getting ripped to the Internet despite a short-lived Motion Picture Association of America (MPAA) screener ban and supposedly tighter controls on who gets access to screeners.

Not that discussion has ever died down, but it looked -- for a minute -- like the heat was off at least until after the Oscars. But the screener leak re-ignited the debate when Sony found a digital copy of the film, ripped from a tagged analog screener, on the Internet.

The more cynical among us might look at the movie's $55.9 million box office over a month and assume it was a publicity stunt. Box office like that on a movie with Jack Nicholson/Diane Keaton star power is not exactly earth-shattering. Maybe leaking the screener was the only way to get anyone talking about this film.

The Academy's Web site carries a list of screeners available to Oscar voters who agree to terms of receipt that are just short of house arrest or tagging the tape with a GPS transponder. I'm not a file trader, but if I was going to steal a movie to share it with a few thousand of my closest cyberfriends, I would be going for the prestige of a 21 Grams, Lost in Translation or House of Sand and Fog, not a film that's losing steam.

The leak comes shortly after McKinsey Research came out with a warning for the content industry that movies could suffer the same fate online as music. I still think that's a bit of a stretch, at least for a year or two, but the McKinsey analyst makes the valid point that illegal downloading will ramp up to fill the content void if the movie, computer and broadband industries can't stave off a the virtual equivalent of a format war and give the people what they want -- and soon.

That means there are at least two format wars looming on the horizon, and mark my words they will overlap. Battle lines are still being drawn over high-def DVD. Internet consumers are tech savvy, they are early adopters who want the latest thing, so they will want high-def, too.

This industry has done so much right with DVD –- content, availability, pricing, marketing –- that the format has taken off like nothing before it. But Hollywood is littered with victims of their own success, and DVD could be just the next casualty if the studios can't play nice with each other and the other two increasingly important sectors in this equation.

Which brings us back to the irony of this particular title getting ripped to the Web. What a metaphor: Something's Gotta Give.

12 Jan, 2004

Packaged Media Still Looks Good Despite the Convergence Emergence

As I trekked through the enormous Consumer Electronics Show (CES) this weekend, I was somewhat overwhelmed and mystified by the numerous entities trying to bring about the digital delivery of entertainment to the home.

The industry and its detractors have been talking video on demand since I got here a decade ago, and I honestly have yet to see anything that beats traditionally packaged delivery of movies, even at this year's CES.

Many of these new technologies seem to hinge on home networking, i.e., getting a digital program from one room to another via wire or wireless. I actually sat in on an educational seminar on digital media servers, and let me tell you this stuff is complicated. There's centralized or networked systems costing anywhere from $350 to more than $5,000. The Kaleidescape system starts at $27,000.

You'll need a wired house (wireless systems are a problem for various reasons), and, from the looks of things, you'll need an on-call techie to administer and problem shoot the thing. You'll also need backup drives with your movies, songs, etc., loaded. If not, you're out of luck if your drives go bad — as they often do.

All of this makes the shiny little DVD look pretty good. Even if I had all the money in the world, I'd opt for a DVD collection rather than the much-ballyhooed network. If you're really in a crunch for space, you can ditch the packaging and just store the DVDs. You can store lots of those slim little things in the space it takes to house your server and backup drives.

The rental business may find a strong competitor in video on demand, but, as far as I can tell, DVDs will be the way to go for the movie collector for a long time to come.