Disney: No 99-Cent Movie Rentals on YouTube

28 Nov, 2011 By: Erik Gruenwedel

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Studio responds to an analyst’s concern about 99-cent rentals negatively impacting sellthrough and UltraViolet

Walt Disney Studios titles will not be rented for 99 cents on YouTube, a studio spokesperson confirmed to Home Media Magazine.

Disney last week joined Universal Studios Home Entertainment and Warner Home Video in offering major catalog and new releases for transactional video-on-demand on YouTube.

“There will not be any films from Disney offered for rent for 99 cents,” Disney spokesperson Bridget Osterhaus wrote in an email.

Chris Dale with San Bruno, Calif.-based YouTube confirmed that Disney titles would not be available for less than $1.99 — the least amount charged for the studio’s titles on iTunes.

While another major studio releasing its titles on a transactional VOD platform is not news, Google-owned YouTube upped the ante by offering several titles for 99 cents for a 24-hour rental window — including recently released Harry Potter and the Deathly Hallows — Part 2.

BTIG Research analyst Richard Greenfield last week opined that studios allowing YouTube to rent major releases for less than what Redbox (and other kiosks) now charge per day would defeat sellthrough (both physical and electronic), in addition to new industry cloud-based digital locker initiative UltraViolet.

That Deathly Hallows — Part 2 was available for $1 less than two weeks after its retail street date appears at odds with Warner Home Video’s first-mover stance with UltraViolet and parent Time Warner CEO Jeff Bewkes’ steadfast opposition to low-margin rental channels.

Indeed, the studio was the first to offer UltraViolet with the releases of Green Lantern and Horrible Bosses.

A Warner spokesperson said the 99-cent titles currently available on YouTube represented a limited time promotion.

“Like all other retailers, Google pays a wholesale price for our content and can charge whatever they choose," the spokesperson said in an email.

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