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DVD Isn’t a Problem at Marvel and DreamWorks

24 Feb, 2009 By: Stephanie Prange

Just as the pundits had all but put the final nail in the coffin of packaged media, both DreamWorks Animation and Marvel executives noted how pleased they have been with disc sales of Madagascar 2 and Iron Man, respectively.

“It’s important to note that 2008 was our most successful non-‘Shrek’ year ever,” said DreamWorks CFO and President Lew Coleman, during a conference call with investors Feb. 24. “[Sales of Madagascar: Escape 2 Africa are a] clear indication that the home video market for us remains encouraging.”

Marvel CFO Kenneth West, in a conference call on the same day, said: “Despite the negative comments we have heard regarding retail sales performance within the DVD market … both The Incredible Hulk and Iron Man DVDs have been performing at or above our expectations.”

And mind you, this is in the context of the worst recession home entertainment packaged media has ever experienced in it’s three decade lifetime.

The hits are still selling well on disc. It’s the catalog business that has fallen off at the big studios — that and individual titles that don’t measure up to the hits of the previous year. If you’ve got The Dark Knight and Iron Man, disc sales don’t look so grim. Meanwhile, Prince Caspian makes things look a bit worse compared to Pirates of the Caribbean 3 the year before.

Why has catalog slumped? It’s because the studios are hitting the back of the vault on DVD releases. The future of catalog is on Blu-ray, which hasn’t yet had a chance to ramp up. Give the disc some time, and sales levels will return. Until then, it is foolish to pretend that consumers don’t like packaged media. They just can’t buy The Godfather or Indiana Jones and the Temple of Doom more than once on DVD. Studios are planning that they buy them on Blu-ray again in the future.

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