Studios Reportedly Eyeing Pre-DVD ‘Home Theatrical’ Window3 Sep, 2009 By: Erik Gruenwedel
Facing sluggish DVD sales and a surge in lower-margin disc rentals, some Hollywood studios are reportedly considering offering new movies via Internet-enabled high-definition televisions prior to the DVD/Blu-ray Disc release.
BusinessWeek Aug. 30 reported that Sony Electronics has approached studios about delivering new-release movies at premium prices via the Internet on its Web-enabled Sony Bravia HDTVs weeks before their DVD/Blu-ray street date. The Japanese consumer electronics giant, which also owns Sony Pictures and Sony Pictures Home Entertainment, tested the concept last year with the Will Smith-starrer Hancock, which was offered to Bravia owners from Oct. 28 to Nov. 10 for $9.99 (for 24 hours) — 11 days before the title’s release on DVD, Blu-ray and cable VOD.
The publication reported that consumer reaction to the Hancock exclusive, which included the Blu-ray edition, was mixed. The story attributed the muted response to the dearth of Web-enabled Bravia HDTVs in U.S. homes at the time — an amount that has now grown to about 500,000 units.
In addition to establishing a new premium release window, the report, citing sources familiar with the concept, said Sony also underscored the delivery channel’s so-called “closed system” that prevented piracy.
A Sony Pictures Home Entertainment spokesperson referred inquiries to Sony Corp.
Sony Corp. chairman and CEO Howard Stringer earlier this year at the Consumer Electronics Show in Las Vegas reiterated his desire that business groups within the company work harder to cross-pollinate marketing and distribution opportunities.
Indeed, Sony Computer Electronics last year inked distribution deals with third-party studios to allow digital streams of content to its PlayStation 3 and PlayStation Portable users.
Separately, studios reportedly are lobbying the Federal Communications Commission to waive its prohibition on selectable output controls on set-top boxes— a move that would allow studios to release new movies in high-definition to cable subscribers prior to the DVD/Blu-ray release.
Kevin Tsujihara, president of Warner Bros. Home Entertainment Group, which includes Warner Home Video, in 2006 discussed the idea of an exclusive pre-packaged media release window for VOD movies delivered via cable.
“We, like everyone else, are trying to figure out what is the right window for pay-per-view in regards to the distribution food chain to maximize profits,” Tsujihara told Home Media Magazine. “From my perspective you have to work backwards from the consumer. What makes sense to the consumer and what offerings are you going to make to the consumer and when.”
Independent analyst Rob Enderle said earlier access to premium content could circumvent piracy since access typically trumps price. But he said charging much more than twice standard VOD pricing would curtail consumer demand.
“People do like and will pay for exclusivity so this could actually work,” Enderle said.