Consumers may be interested in digital distribution, but when it comes to opening their pocketbook packaged media takes the cake — by a wide margin. According to the NPD Group's "Entertainment Trends In America" consumer tracking study, the average U.S. home video consumer reported spending an average of $25 per month on all types of home entertainment. The lion's share, 63%, was spent on DVD purchases; 7% was spent on BD purchases; 18% went to DVD and Blu-ray Disc rentals from retail stores, subscriptions or kiosks; 9% went to video on-demand (VOD); and just 3% was spent on digital downloads and online streaming.
The long-awaited new Star Trek movie grossed $76.5 million its opening weekend, according to estimates provided by distributor Paramount Pictures, a little higher than the studio had expected. The picture opened at 3,849 locations and made a solid $30.8 million on Friday night and another $27.4 million on Saturday.
Last week's No. 1 movie, X-Men Origins: Wolverine, fell 68% from its opening gross to $27 million, still enough for a second-place finish.
The Summit Entertainment urban comedy Next Day Air, the weekend’s other wide opener, grossed just $4 million.
Wal-Mart just reported a 7.7% increase in sales for April, to $19.3 billion, while same-store sales in the United States grew a healthy 5.9%. The discount chain, the country's No. 1 seller of DVDs, attributed the strong showing to increased traffic and higher discretionary spending in such categories as entertainment. For the 13-week period that ended May 1, sales at Wal-Mart were up 5.8% from the comparable period last year. Wal-Mart says it will announce results for the first quarter of its fiscal year 2010, which ended April 30, on May 14. The company says it expects to report total net sales for the quarter of $93 billion.
I woke up this morning to some cheery news: First-quarter sales of stand-alone Blu-ray Disc players in the United States rose 72% from the first quarter of 2008. NPD’s latest Blu-ray report update also shows that overall consumer awareness of the Blu-ray Disc format in the United States has reached 90% over the last six months.
Kelley Avery’s abrupt departure as worldwide president of Paramount Home Entertainment (for the complete story, click here
) no doubt came as a shock to all of us. The only female head of a major studio worldwide home entertainment division, Avery has been part of our industry for 25 years, ever since she first came to work at what was then Buena Vista Home Video. There, she worked alongside Bill Mechanic and Ann Daly to pretty much define the concept of sellthrough. She also was part of the team that pioneered Disney’s enormously successful moratorium strategy, in which animated classics are only put in stores for a limited amount of time and then stuffed back into the vault, in the hopes of generating even more demand. The strategy’s success can best be illustrated by The Lion King, which came out in the pre-DVD days (1995, I believe it was) and sold more than 20 million copies—VHS cassettes, mind you!
Kelley left Disney for DreamWorks SKG when the new studio was set up in 1998 by ex-Disney studio chief Jeffrey Katzenberg, record mogul David Geffen and acclaimed producer and director Steven Spielberg. She launched the new studio’s home video division—I still remember the first video release, Mouse House, a not-so-subtle stab at Katzenberg’s former employer—and impressed all of us in the trades with her poise as well as her smarts. She assembled a great team, none of whom had titles (that was the DreamWorks way) but all of whom worked tirelessly to turn DreamWorks into the little studio that could—and that did. The hits kept coming—Saving Private Ryan, the Shrek franchise, Gladiator—and when DVD came around Avery and her team helped broaden the market by focusing on families with such key releases as the first two Shrek movies, which were instrumental in bringing DVD to the masses.
Kelley went to Paramount in 2006, when the studio’s parent, Viacom, bought DreamWorks SKG for I believe it was $1.6 billion. Tom Lesinski, the Warren Lieberfarb prodigy who had been brought in from Warner Home Video to run Paramount Home Entertainment just a short while before, took over digital and Kelley brought her team in to take charge of Paramount’s packaged-media operation. Key players included Kelly Sooter and Mary Kincaid, both of whom had worked alongside Kelley at DreamWorks (and in Mary’s case, the two had worked together back at Disney).
The rest of the team is still in place and, I’m told, it will be business as usual. No replacement is being named for Kelley, whose departure apparently caught her studio bosses by surprise. Her senior executives will report to Rob Moore, the studio’s vice chairman.
As for Kelley Avery, stay tuned. She’s got something up her sleeve, and I’m sure she will resurface soon.
DVD sales may be slumping, but rentals are doing just fine. A big reason is the economy, as well as operations like Netflix and Redbox, both of which are a lot easier and more convenient than renting a video at a brick-and-mortar store. Then again, you don't get the fun of browsing .... Check out my story on rental's resurgence in the May 5 issue of USA Today by clicking here.
Just finished the weekly box office story for USA Today, in which I noted that X-Men Origins: Wolverine, probably the year's most anticipated movie, opened to an estimated $87 million this weekend, despite concerns over the swine flu and an unfinished version of the film popping up online for illegal download. Wolverine officially kicks off the summer movie season, which this year features a big tentpole title virtually every week. To read the complete story, please click here.
Now that we've seen first-quarter results in which consumer spending on home entertainment dipped 5% from the first quarter of 2008 (when digital distribution is factored in), the slighter-than-expected decline--and three months of strong box office--are fueling optimism among packaged-media executives. One high-ranking studio source said his latest internal research suggests the year may find total consumer spending, sellthrough and rental combined, decline by just 4% for the whole year, and the interesting point here is his numbers DO NOT include electronic sellthrough, VOD and other forms of digital distribution. That's right, he's only talking about packaged media, DVD and Blu-ray Disc. DVD sales and rentals are expected to be off 10%, this executive told me, but a gathering swell of interest in Blu-ray Disc will make up a huge chunk of those dollars and actually give our industry less of an overall decline than we saw in 2008. Food for thought....
Reports are surfacing that Macs may well go Blu-ray, even though Apple CEO Steve Jobs just last October called Blu-ray and its licensing process "a bag of hurt." If the reports, as yet unconfirmed, are true, it's even odds who the winner will be: Blu-ray for winning over a formidable new ally (think iTunes), or Apple for finally recognizing the inevitable. In truth both sides would benefit, which is why I believe official confirmation will come soon — possibly at the June 8-12 Apple Worldwide Developers Conference in San Francisco. Now if we can just get Toshiba to stop with the "upconverter" B.S. and start making Blu-ray Disc machines, like everyone else …
Notorious, 20th Century Fox Home Entertainment's biopic on rapper Notorious B.I.G., took the top spot on the Nielsen VideoScan First Alert sales chart for the week ending April 26, while The Wrestler, also from Fox, was the week's top renter--and the top seller in the Blu-ray Disc format. For the complete chart story check our Web site later today.