Six Questions: Eric Doctorow15 May, 2009 By: Thomas K. Arnold
Eric Doctorow is the longest-serving studio chief in Hollywood’s home entertainment sector. He became president of worldwide video for Paramount Pictures in 1994, and has been keeping close tabs on the business ever since, most recently as GM of MGM Worldwide for the past three years.
In the midst of MGM’s 85th anniversary, Home Media Magazine sat down with Doctorow to gain his perspective on several big issues, opportunities and challenges that face us today. Fifteen years after he first became a worldwide home entertainment president, Doctorow possesses a vast body of institutional knowledge — and continues to be one of the home entertainment sector’s top movers and shakers.
HM: MGM celebrates its 85th birthday this year, a year after Warner Bros. What special events or releases do you have in store to capitalize on this milestone?
Doctorow: For the coming year, we have a number of cool releases planned: A 40th anniversary edition of Hair, an all-new special collector’s edition of Spinal Tap on Blu-ray Disc, and a 30th anniversary edition of Mad Max. We have a couple of “Stargate” surprises planned. The entire “Rocky” collection will also street on Blu-ray in time for the holidays. And, finally, we have some neat gift sets being planned for later in the year.
HM: Consumer spending is down about 5%, according to the latest DEG: The Digital Entertainment Group findings, with the biggest hit going to DVD sales. You’ve weathered ups and downs numerous times in your career, and were still running Paramount during the Great Dip of 1997, just before DVD rode in and saved the day. What’s your perspective on what we are seeing in the business?
Doctorow: It is pretty clear that the DVD business is fairly mature, but it is not broken. The economic climate has made this past year harder than ever, but consumers still want to buy DVDs … and they are. The industry is down less than 10% in unit sales. I can think of a lot of industries that would cheer that statistic. Consumers are looking for value propositions more than ever, especially for catalog. Therefore, we have become laser-focused on working with retailers to develop consumer propositions that are especially appealing. While lowering prices is one answer, it cannot be the only answer, so we spend a lot of time developing ideas that are not just price-driven but are also “benefit-driven.” We also put a microscope on our costs so we can help bolster our margins.
HM: How have these lean times changed the way studios need to market their product?
Doctorow: Take nothing for granted. Focus on costs as well as revenue. Work as closely with retailers as possible to build programs for their customers’ new attitudes. Make it simple.
HM: Despite the down economy, rental activity held up quite well in the first quarter of this year, with consumer spending rising 1%. Does rental’s resiliency surprise you?
Doctorow: No, not at all. Renting movies is a great, inexpensive way to spend an evening at home with family and friends. The growth of rental demonstrates that consumers still love watching movies on discs, whether they buy them or rent them.
HM: How confident are you that Blu-ray Disc will triumph?
Doctorow: Very. Statistics show that player sales soared 72% in Q1, according to The NPD Group, and are getting cheaper. In addition, The DVD Release Report shows we now have more than 1,000 titles in the marketplace. Sales are growing every quarter. Quantum of Solace had the highest percentage of sales coming from Blu-ray of any title ever. Blu-ray is a wonderful format and plays right into our culture’s obsession with quality and all things high def.
HM: There’s been talk about BD Live and especially 3-D potentially being Blu-ray Disc’s “killer app.” Can you talk a little about the promise of BD Live, and what still needs to be done?
Doctorow: Ah, BD live. It is a very exciting and promising opportunity. The notion of being able to transcend the physical disc and move onto the Internet or have new content downloaded to the player is a wonderful vision. Like so many technology curves, this one, too, has to find a commercial model that works. Right now I think lots of people are trying to do that. I am certain that it will happen … when, is the question. And, of course, 3-D on Blu-ray would become an extraordinary development.