Home Media Magazine - August 19-25, 2007 - (Page 8)

NEWS BRIEFS I REPORT: $1B MGM FILM FUND DERAILED The worldwide squeeze on available credit in the aftermath of the subprime mortgage crises has reportedly resulted in film studio Metro-Goldwyn-Mayer losing out on a $1 billion line of credit. The finance plan, formerly underwritten by Goldman Sachs and Deutsche Bank, would have funded a slate of theatrical films, including The Hobbit, the fourth “Terminator” film and the next “James Bond” film, a joint venture with Sony Pictures, according to the Financial Times of London. The report said the loss of institutional investors will likely just delay — not end — funding. —Erik Gruenwedel www.homemediamagazine.com Genius Makes First Profit The company will increase film production and acquisition By Thomas K. Arnold million and a total of up to $70 million for nonS T U D I O Genius Products LLC turned a quarterly prof- Weinstein Co. product. it for the first time in company histoThe three-year, senior-secured rery and expects to sharply increase its volving credit facility will be used to direct-to-video output, thanks to a acquire, produce and co-produce, $70 million credit facility from one of with current branded-partners, conthe world’s largest financial services tent in the sports, family and faith, groups. lifestyle and independent film cate«OUR ATTENTION The home entertainment supplier, gories. HAS NOW BEEN TURNED 70% owned by The Weinstein Co., Non-Weinstein content is slated to TO CO-PRODUCTIONS AND has bulked up with 16 distribution represent close to 50% of third-quarOWNERSHIP.» deals since ex-Warner Home Video ter revenue toward a goal of 25% nonTREVOR DRINKWATER, executive Trevor Drinkwater came Weinstein revenue for the fiscal year, GENIUS PRODUCTS CEO aboard two years ago as president and according to Drinkwater. CEO. Profitability came earlier than expected, with He cited Casper’s Scare School, a higher margin co-proGenius in the second quarter (ended June 30) posting duction with Classic Media that will air on Ion the weeknet income of $2.1 million on record revenue of $145 end preceding the DVD release. million. “These improvements helped turn our company to Santa Monica. Calif.-based Genius said it had secured profitability and will continue to drive results in the fua credit facility arranged by Société Générale that pro- ture,” Drinkwater told analysts in a call. “And it also is vides the company with an initial commitment of $30 See GENIUS, Page 36 Image Q1 Margins Up, Losses, Too By Erik Gruenwedel mage Entertainment posted a first-quarter (ended June 30) loss of nearly $2.6 million, compared to a $2.3 million loss during the same period last year. Ongoing merger, restructuring and legal expenses all contributed to the drop. Revenue for the quarter fell 6.6%, to $20.9 million, from $22.3 million last year. Chatsworth, Calif.-based Image increased quarterly profit margins to 25.4% from 18.6% last year due to a series of niche DVD releases from Discovery Channel and Criterion Collection. “This reflects on the company’s efforts to focus on higher profit-margin programming through a more narrow range of programming acquisitions,” Martin Greenwald, president and CEO of Image, said in an analyst call. He said the DVD marketplace is a challenging environment with a shift toward larger diversified brickand-mortar retailers and increased online competition. “Amazon, Netflix and Blockbuster Online are rapidly becoming far more of a presence in the marketplace, and it tends to drive out the weaker-performing brick-and-mortar locations,” Greenwald said. Digital sales — which include Egami Media, digital downloads and video-on-demand — totaled $495,000, compared to $260,000 last year. “Although those revenues are currently slightly more than a rounding error, I envision continued acceleration in this segment of our business,” Greenwald said. “It is clear digital delivery platforms are poised for explosive growth in the coming quarters and represent a true paradigm shift in distribution.” Selling expenses were 9.8% of revenue, down from 10.5% of revenue last year for actual savings of $300,000 for the quarter. A significant factor in the reduction was the elimination of 16 employees since last year. Company executives said Image is finalizing a shareholder proxy regarding its pending acquisition by BTP Acquisition Co. LLC, an investor group led by film financier and producer David Bergstein. “We are still confident that a closing can take place in the next 45 to 60 days,” Greenwald said. I I ARTS ALLIANCE AMERICA CATCHES ‘RUN GRANNY RUN’ Arts Alliance America, formerly Hart Sharp Video, and HBO have acquired the rights to Marlo Poras’ documentary Run Granny Run, which looks at the political meddling of a 90-something woman who walked across America for campaign finance reform, and ran against an incumbent Republican for a U.S. Senate seat. The film will premiere on HBO Oct. 18 and will be released on DVD, closely tied to the election. –Chris Tribbey Netflix, Target, Warner Nab Bennett DVD Deal By Erik Gruenwedel etflix Inc. has partnered with Warner Home Video, Target Corp. and PBS station Thirteen/WNET in New York to release a proprietary documentary on legendary crooner Tony Bennett. Tony Bennett: The Music Never Ends, which was developed by Netflix unit Red Envelope Entertainment and produced by Oscar-winning director Clint Eastwood in association with RPM Productions, will air Sept. 12 as part of the American Masters series on PBS. The DVD will be available Sept. 25 on Netflix, including the Los Gatos, Calif.-based online DVD I WESTLAKE ACQUIRES RIGHTS TO ANDERS FILM Westlake Entertainment has acquired the rights to Allison Anders Presents: The Pacific and Eddy, which will get a theatrical release this fall and a DVD release in early 2008. Starring Dominique Swain, Ryan Donowho and James Duval, Allison Anders Presents: The Pacific and Eddy sees four characters mourn for the loss of a friend in their own ways, each leading to striking self-realizations. –Chris Tribbey N rental pioneer’s Web-based streaming service. The title will simultaneously street for an exclusive six-week run at Target prior to the Nov. 13 home video release of a two-disc special edition, which includes 60 minutes of bonus footage from Bennett’s appearance at the 2005 Monterey Jazz Festival. The DVD follows Bennett’s 50plus years in the music and entertainment business and features an exclusive interview conducted by jazz aficionado Eastwood that attempts to explore the essence of Bennett’s artistry. “The film is the coming together of two American icons … and a big leap for Red Envelope Entertainment,” said Ted Sarandos, chief content officer for Netflix and executive producer of the film. “The production and the unique rollout arrangements draw on the relationships and brand strength that Netflix has developed in the creative and distribution communities.” I NEW ANIMATION STUDIO TO ENTER DVD BUSINESS Threshold Entertainment, producer of the “Mortal Kombat” game franchise, has partnered with a private equity firm to launch Tinseltown Toons, a DTV animation studio. The DVDs will feature characters from the Lego toy brand. Universal Studios Home Entertainment will distribute the DVDs. –Erik Gruenwedel TRENDS IN NEW RELEASES FOR MUSIC DVD TEN CALENDAR QUARTERS: 2005 – 2007 I RESEARCH: FRONT-SEAT VIDEO DISPLAYS A NON-ISSUE Angst over driver distraction, should demand for front-seat video displays in cars escalate, is a non-starter, according to ABI Research. The company said with 39 states prohibiting installation of front-seat DVD players and limited demand for real-time video in cars, only 300,000 OEM shipments of digital radio hardware for video would materialize by 2011. –Erik Gruenwedel The music DVD category has seen better times. Every quarter in 2005 saw a quickening of the release pace. Then came upheavals at retail, followed by distribution shake-ups at several of the major labels. Beginning in Q3 2006, it has been all downhill. Has the time arrived for lowered release expectations? Have the easy pickings been had, and more of the same not worth the effort? Have long-term trends in the music business conspired to limit the new talent base? The second half of 2007 should be an interesting period for the category. Up? Down? Or sideways? — Ralph Tribbey 554 482 447 405 580 489 472 402 550 500 450 400 350 300 250 Q1 2005 Q2 2005 Q3 2005 Q4 2005 Q1 2006 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 I THIS WEEK’S RELEASE ACTIVITY FOR DVD Titles in Release Through Week Ended Aug. 10, 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Net DVD Titles Announced and/or In Release Through Dec. 31, 2007 . . . . . . . . . . . . . . . . . . . . . . . . 75,565+221 76,553+169 I THIS WEEK’S RELEASE ACTIVITY FOR BLU-RAY As of Week Ended Aug. 10 . . . . . Released I THIS WEEK’S RELEASE ACTIVITY FOR HD DVD Scheduled As of Week Ended Aug. 10 . . . . . Released 268 Scheduled 56 Home Media Magazine August 19–25, 2007 http://www.homemediamagazine.com

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Contents News News/Box Office News TV DVD Q4 Preview Reviews Pipeline Research Top 20 DVD Sellers Top 20 Rentals and Top 10 Charts Just Announced

Home Media Magazine - August 19-25, 2007

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