Home Media Magazine - May 4-10, 2008 - (Page 28)

NEWS Blockbuster Looking at Its Digital Options Continued from page 1 The Dallas-based No. 1 DVD rental chain, which was once owned by Viacom, would retain non-exclusive digital rights to the content, according to The Wall Street Journal. The video-on-demand platform is slated to compete against pay-per-view movies from Showtime, HBO and Starz. Blockbuster spokesperson Karen Raskopf would neither deny nor confirm the report. She said the company was exploring many options as it continued to transition from a pure rental into an entertainment convenience store. Blockbuster, which is in the process of attempting to acquire electronics retailer Circuit City Stores, is ramping up availability of Blu-ray and video game hardware and www.homemediamagazine.com related software throughout its corporateowned stores. It also owns download service Movielink, which will be incorporated into Blockbuster Online. “So, it’s not surprising there are rumors out there,” Raskopf said. Arvind Bhatia, analyst with Sterne Agee Group in Dallas, said Blockbuster’s investment in Viacom’s pay-TV project would make sense and likely not be more expensive than its $6.6 million acquisition of Movielink. “It gains them experience in that market,” Bhatia said. “The investment is pretty low. By getting the digital rights to download movies, they can become the go-to site.” The analyst said Blockbuster CEO Jim Keyes wants to be everywhere, which includes downloads, sellthrough, video games, electronics, concessions and beverages. “He is certainly trying to see what makes sense for his company and customers,” Bhatia said. “He wants to be where the market is going.” Bhatia said he wouldn’t be surprised if Netflix invested in the project as well. He said the online rental pioneer has been spending heavily on movie streaming and has stated a desire to incorporate the service and its brand in third-party set-top boxes. “The idea is to be ahead of the curve,” Bhatia said. A Netflix spokesperson was not immediately available for comment. PANEL DEBATES DVD’S PLACE IN DIGITAL AGE By Erik Gruenwedel ‘Grand Theft Auto IV’ Set to Break First-Week Game Revenue Record By Chris Tribbey GAMES It may turn out to be one of the most lucrative first-week launches in entertainment history, and it has nothing to do with the movies. Analysts are predicting to several news organizations that the April 29 release of Grand Theft Auto IV for the PlayStation 3 and Xbox 360 could result in more than 9 million copies sold in the first month, 6 million of those in the first week. First-week revenue would approach $400 million, topping the previous record of $300 million in first-week sales for last year’s release of Halo 3 for the Xbox 360. Sales in the United States had not been released in time for publication. However, the game broke the one-day sales record in the United Kingdom, with 609,000 copies sold. In America, there was speculation that the game could hurt box office receipts. “People on Friday or Saturday might find themselves at home playing this game instead of at the Cineplex,” Edward Woo, a research analyst in media and interactive entertainment at Wedbush Morgan Securities, told The Associated Press. “Iron Man will still have a pretty good release, but intuitively, I think it’s got to be impacted when both share a similar audience and genre.” This is the second “Grand Theft Auto” game to be released simultaneously for both the Xbox 360 and the PlayStation 3 — both of which lag far behind Nintendo’s Wii in household penetration. David Riley, director of The NPD Group, said it’s a sure bet Grand Theft Auto IV will drive hardware sales. “It goes without saying that it will have a positive impact on hardware sales,” he said. “Looking at historical sales trends, we often see spikes in hardware sales around highly anticipated titles like GTA IV.” The controversial action game is rated ‘Mature’ in the United States, meaning it’s only available to players 17 and older. But that won’t affect sales, analysts said. And unlike Halo 3, this game will be available for both high-def gaming consoles. “Halo 3 took the approach of going after a less-core consumer, but they had an ulterior motive,” Steve Fowler, VP of strategy for advertising and marketing firm Ayzenberg Group, told The Associated Press. “Microsoft was using Halo 3, their biggest property, to sell more Xbox 360s. [GTA IV creators] Take-Two and Rockstar are free of that constriction because GTA IV is on both platforms.” tudios grappling with expanding content distribution beyond DVD to include electronic video-on-demand distribution and pay-per-view channels continue to walk a fine line between incremental revenue and cannibalization, said a panel of entertainment executives last week. Faced with the statistic that digital sales represented less than 7% of entertainment revenue in 2007, panelists at the Milken Institute Global Conference in Beverly Hills, Calif., said technological advancements in content distribution are moving too quickly to ignore. “It’s what I spend the most of my time on,” said Peter Chernin, president and COO of News Corp., which owns 20th Century Fox, Dow Jones & Co., MySpace and recently launched content site Hulu. com, among other properties. Chernin downplayed concerns expansion of entertainment via streaming, downloads and video-on-demand would negatively impact the existing DVD business model. “We are in the business of creating content and distributing it as ubiquitously as possible,” he said. Chernin said Fox’s digital and DVD divisions are run by the same home entertainment company, which he said required a neutral corporate stance about whether consumers should buy, download or stream content. The executive said recent discussions between studios and Apple regarding margins on movie sales and rental necessitated S moving forward. His comments came less than 24 hours before Apple announced it would offer major studio movies for sellthrough on iTunes. “What we are primarily concerned with is how we can maintain margins,” Chernin said. The COO said the costs associated with releasing a movie for download and on DVD were virtually identical. The fiscal returns for DVD rentals, however, paled in comparison. “What we do want is pay-per-view to replace video rentals,” he said. “Ultimately, that is more profitable for us.” Mark Thompson, director-general with the British Broadcasting Co., said online availability of “Planet Earth” hadn’t stymied DVD sales of the popular series, which he said totaled more than 3 million units to date. “A stream of ‘Planet Earth’ might well actually have increased DVD sales,” he said. The BBC recently launched its iPlayer, a free download that allows users to access BBC content, including music, on a PC. A compatible iPlayer for cable and mobile is in the works as well. Chernin said the transition from DVD to VOD is inevitable despite continued demand for packaged media. “The easier it is to acquire a movie, whether it is in Wal-Mart, electronic or VOD, ultimately there will be market growth,” he said. “It’s not going to be a tripling effect but you will see is that these things are moderately additive.” L ATE FL ASHES I RAISED PRICING HELPS COMCAST Spurred by a 5% increase in video revenue (due largely to price hikes), Comcast Corp. posted a 10% surge in first-quarter (ended March 31) consolidated revenue to $8.3 billion, compared to revenue of $7.3 billion during the same period the prior year. The U.S. cable operator said video revenue, which also featured increased demand for VOD, digital video recorder (DVR) and highdef programming, topped $4.7 billion, compared to $4.5 billion the prior year. The company reported net income of $732 million, down 12.5% from $837 million the prior year. Comcast said income would have risen nearly 10% if not for one-time gains related to the dissolution of unspecified cable – Erik Gruenwedel partnerships. ‘Cellar Door’ Opens to DVD I GENIUS LAYS OFF 32 Citing ongoing restructuring, Genius Products Inc. has laid off 32 employees, or 14% of the staff, a spokesperson confirmed. The distributor — 70% owned by The Weinstein Co. — continues to diversify its content portfolio with higher-margin content, including video games and Christian titles. Genius is also working with brands such as World Wrestling Entertainment and Sesame Street to expand its content beyond packaged media and into electronic sellthrough, licensing, games and music. The company, which posted a fiscal-2007 loss of $17.7 million on revenue of $474 million, has 2008 contractual obligations (royalty advances, leases etc.) exceeding $33 million, according to a regulatory filing. – Erik Gruenwedel Horror enthusiasts and Hollywood types gathered April 15 for The Cellar Door DVD launch party. (L-R): Star of the film James DuMont, producer Hilary Six, director Matt Zettell, actress Michelle Tomlinson, writer Christopher Nelson, and Tiffany Mastrovito and Chris Mastrovito of Monterey Media at Seven Hollywood, where the cast assembled after signing DVDs at Rocket Video in Los Angeles. HOME MEDIA MAGAZINE (ISSN 1934-9882) is published weekly 51 times per year (weekly except for one week at the end of December) by Questex Media Group, Inc., 306 West Michigan Street, Suite 200, Duluth, MN 55802. Subscription rates: $49.99 for one year in the United States and Possessions; $79.99 for one year in Canada and Mexico; all other countries $99.99 for one year (by surface mail). Add $75 annually for air-expedited service. Single copies (prepaid only): $6.99 in the United States, $8.99 in Canada and Mexico, $13.99 all other countries. Back issues, if available: $9.99 in the U.S.; $15.99 in Canada and Mexico; $26.99 for all other countries. Include $6.50 per order plus $2 per additional copy for U.S. postage and handling. Periodicals postage paid at Duluth MN 55806 and additional mailing offices. POSTMASTER: Please send address changes to HOME MEDIA MAGAZINE, P.O. Box 1270, Sk http://www.homemediamagazine.com

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Home Media Magazine - May 4-10, 2008 Contents News TV DVD Reviews Pipeline Research Top 20 DVD Sellers Top 20 Rentals and Top 10 Charts Just Announced

Home Media Magazine - May 4-10, 2008

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