Paramount Home Video: A History30 Apr, 2012 By: Doug Desjardins
Paramount Pictures founded its home video division in 1979, joining Columbia Pictures as the first studios to venture into the fledgling industry. With the format war between VHS and Betamax in full swing, Paramount took tentative steps into the business the first few years. But once VHS emerged on top, Paramount Home Video found its stride under the leadership of Mel Harris, a young marketing executive in Paramount’s TV division appointed as president.
From the start, Harris had a different take on the industry. At a time when most studios were focused on the booming video rental market, Harris believed consumers would buy and collect their favorite movies on video if the prices were right (a practice later termed “sellthrough”) and tested his theory in 1982 by pricing Star Trek II: The Wrath of Khan at $39.95. It was a revolutionary move, a gamble — and it paid off handsomely.
Around that time, Paramount hired a former RCA executive to help with its marketing efforts.
“The first title I worked on was Flashdance, which was the second title Paramount released at a sellthrough price,” said Eric Doctorow, who joined Paramount as VP of sales and marketing in 1983 and would eventually serve as president of worldwide home entertainment.
Nina Stern, who joined Paramount Home Video in 1982 as head of publicity, recalls that Harris began pushing sellthrough titles with clever promotions and increasingly ambitious marketing campaigns.
“I think Flashdance sold about 150,000 copies, which was huge at the time, and then Raiders of the Lost Ark came along and sold over 500,000 copies,” Stern said. “Mel Harris was a brilliant marketer, and he was the mastermind behind a lot of the promotions and marketing strategies that became industry standards.”
Harris would eventually leave to become head of the Paramount Television Group. He died in September 2008 of cancer, at the age of 65.
By 1985 Paramount slashed the price of its top 25 titles to $24.95 and packaged them together as the industry’s first holiday promotion. The studio’s home video division also began staging press events to celebrate the release of big titles or titles that reached new milestones. When Beverly Hills Cop II sold a staggering 1.4 million copies in 1987, it announced the feat at the old Gulf + Western building with a press event that featured star Eddie Murphy and Paramount Studios chief Frank Mancuso. It marked a turning point in the industry and showed that studios were willing to use star power to promote the home video format.
In 1991, Paramount went in a new direction when it teamed with McDonald’s on an “Indiana Jones” promotion. Customers could buy Raiders of the Lost Ark, Indiana Jones and the Temple of Doom or Indiana Jones and the Last Crusade for just $5.95 with the purchase of select menu items.
“That really set the standard for future deals between fast food restaurants and the studios,” said Doctorow, who was appointed president of Paramount Home Video in 1993.
Paramount set another milestone when it shipped 24 million VHS copies of Titanic to retailers in September 1998. In 1999, Titanic became the first DVD to ship 1 million units, two years after the format bowed.
As DVD players started coming down in price and saturating the market, the shift away from VHS accelerated. It also kicked off another format war for the next generation of discs, pitting Toshiba’s HD DVD format against Sony’s Blu-ray Disc. Paramount initially released titles on both formats for a brief time in 2007 before siding with HD DVD, then switching to Blu-ray when Toshiba dropped HD DVD.
During the transition from VHS to DVD, Doctorow ended his 20-year stay at Paramount in 2003. He was replaced by Tom Lesinski, a former Warner Home Video executive. Lesinski helped guide Paramount into a new era of movies being distributed on multiple platforms, with the emergence of digital distribution.
In January 2006, when Paramount closed its acquisition of DreamWorks SKG, Kelley Avery, a Disney veteran who had been running DreamWorks’ worldwide home entertainment division, was appointed president of Paramount Home Entertainment. Lesinski became president of Paramount’s newly formed Paramount Digital Media Group.
Avery and her team, which included fellow Disney alumna Mary Kincaid, headed marketing programs for some of the biggest-selling discs of the decade. In 2008, Paramount set an industry record when Iron Man sold 7.2 million units during its first week of release and shattered that record in 2009 when Transformers: Revenge of the Fallen sold 8.3 million units during its first week. By then, Avery had departed — she resigned in May 2009 — but her team remained pretty much intact.
Another Disney vet, Dennis Maguire, was appointed president of Paramount Home Entertainment in October 2009. Two years later, a major reorganization merged home entertainment with television licensing and digital licensing. Maguire was named president of the newly formed Paramount Home Media Distribution.
Paramount started 2012 with an industry first when it announced plans to sell digital movies and TV shows to consumers directly from its website. And in April, it reached a deal with YouTube that made nearly 500 Paramount films available on YouTube’s rental service for the first time.
In addition to distributing content for Paramount Pictures, PHMD distributes programming for CBS, PBS, MTV, Comedy Central and Nickelodeon.
To commemorate the 100th anniversary of its parent company, PHMD is teaming with Delta Vacations to give consumers a chance for a free vacation to cities that are the setting for some classic Paramount films, including New York City (The Godfather) and San Antonio (Wings). Paramount will also release one of its classic films on Blu-ray for the first time each month. Upcoming releases include Hondo (June 5), Barbarella (July 3) and Clue (Aug. 7).