Home Media Magazine - February 2, 2009 - (Page 25) www.homemediamagazine.com NEWS “Streaming is going to get costlier and less compelling to a lot of people,” Doherty said. He said President Obama pledged to make broadband access in U.S. homes a more economical option, from $15 to $20 per month, compared to about $35 per month currently. Households that are used to streaming and downloading a lot of content may see their monthly bill increasing to $45 or $55 per month. Indeed, Obama created a mild panic in Silicon Valley during his first weekly radio address when he failed to mention a $6 billion stimulus campaign promise earmarked for broadband. Om Malik, founder of the GigaOm blog network, told Yahoo! Finance that technophiles shouldn’t jump to conclusions about the omission. At the same time, he said he hoped the funds — part of Obama’s proposed American Recovery and Reinvestment Bill — don’t just fall into the hands of Comcast, AT&T and others. “Instead, the stimulus money should go to smaller companies in areas where there is a broadband problem,” Malik said. While broadband proponents wrestle for funds, Blu-ray Disc prices continue to fall. BD pricing dropped 14% in 2008 to an average retail price of $28.93, which still represented a $13.19 premium on standard DVDs, according to Media Control. Indeed, Sony Pictures Home Entertainment, in a weekly newspaper circular, offered instant $3 discounts on 15 titles, including Pineapple Express, Hancock, Underworld: Evolution, Step Brothers and Nick & Norah’s Infinite Playlist. Analyst Doherty said Blu-ray would become even more affordable after Sony’s recent announcement it would build a disc replication facility in China. He said movies should cost less to replicate and package, which would translate into more-attractive new and catalog release prices. “[Catalog is] what really saved DVD over the past 10 years,” Doherty said. Blu-ray May Surpass Digital Delivery Continued from page 10 I BLOCKBUSTER HIRES ONLINE DIRECTOR Blockbuster Inc. named Robert Barr VP of Blockbuster.com. Barr will lead Blockbuster Online, including re-establishing the Dallas-based company’s online retail and by-mail subscription programs — a daunting task considering rival Netflix’s market superiority in the space. Barr was SVP of Interactive for Education Management, a $1.6 billion for-profit Phil Leigh, analyst with Inside Digital media in Tampa, Fla., said BD revenue projections are misleading because the format generates a premium on a perunit basis, versus DVD and digital. “I’m not sure I believe the revenue forecast,” he said. Richard Doherty, director of The Envisioneering Group in Seaford, N.Y., said the concerns were moot since BD prices continue to fall as streaming costs rise. He said streaming costs facing Hulu, Netflix, Blockbuster or CinemaNow are rising exponentially and ultimately have to be underwritten by the end user, which they currently aren’t. “It’s costing Netflix and other Internet providers ‘tens of cents’ to watch any given movie,” Doherty said. “You watch 90 movies in a month, and [they’re not] making any money.” Reed Hastings, CEO of Netflix, said the combination of partnering with CE manufacturers and reduced disc usage by subscribers would help stymie escalating streaming costs. Netflix spent more than $11 million on streamed content and catalog acquisitions in the fourth quarter ended Dec. 31, according to a regulatory filing. “We should be able to keep increasing our content investment while at the same time growing earnings,” Hastings told investors. Doherty said the current recession put expansion plans for the Internet, which included broadband proliferation, on hold. At the same time, demand for streaming has risen, leading some cable operators such as Verizon, Comcast and AT&T to consider capping or placing a monthly surcharge on consumers. educational provider in the United States and Canada. Last week Blockbuster named former Philips executive Kevin Lewis Barr to oversee Blockbuster’s forays into direct-to-home connected devices, set-top boxes, portable video players, DVD vending machines and digital kiosks. — Erik Gruenwedel Blockbuster Faces Debt Risk Continued from page 6 REPORT: 2008 VIDEO GAME SALES OUTPACED SALES OF HOME VIDEO By Chris Tribbey software report from research firm Media Control Gfk International found that in 2008 sales of video games for the first time ever outpaced sales of DVD. Prices aside — a $50 video game vs. a $20 DVD — the statistics show gaming is proving exceptionally recession resilient. Even with Blu-ray Disc added, overall DVD sales were down 6% from the previous year in 2008 to $29 billion in sales, according to the report. Sales of video game software, however, jumped 20% in 2008, to $32 billion. Console video game sales represented $21 billion of the pie, with handheld and PC games accounting for the rest. Games for Nintendo’s Wii system drove most of the growth, Gfk reported. you haven’t noticed, banks aren’t particularly eager to lend hundredmillion-dollar sums right now, which leads me to believe that Blockbuster is facing a liquidity crisis.” Not so fast, said Arvind Bhatia, analyst with Dallas-based Sterne Agee who covers Blockbuster. Bhatia agreed there are risks for Blockbuster satisfying its workingcapital needs, a burden the analyst said nearly every industry is facing in the current economy. He said Blockbuster’s long-term debt isn’t due for years, and ongoing cost-cutting efforts are sufficient to supply the chain with required liquidity. Bhatia said the company has alternative financing (at undesirable rates) in place — despite the credit freeze — should the need become acute. The analyst added that with infamous renegade investor Carl Icahn on the board, Blockbuster has an ace in place for the mean streets of Wall Street. “I can’t imagine in the very least that he wouldn’t give them a working- capital line, considering he was back shopping them for a $1 billion Circuit City deal,” Bhatia said. “We think they will come out fine.” Edward Woo, research analyst with Wedbush Morgan Securities in Los Angeles, concurred that Blockbuster faces the same challenges nearly every company and industry does: surviving in a credit-absent environment. “Their recent positive performance shows that … things won’t be [so] bad that they will go out of business in the near term or this year,” Woo said. Bhatia said given Netflix’s impressive quarterly results Jan. 26, the DVD rental business is sound. “It’s telling that the DVD rental category is still robust,” he said. “Blockbuster is obviously not emphasizing the by-mail business, and Netflix took some customers from them. The category still has to be performing for Netflix to do well. The fact they have nearly 10 million customers shows that people are still renting DVDs.” Blockbuster is slated to present Feb. 2 at an investor conference in Miami. Sundance Spawns Studio Action Continued from page 7 and Latin American rights to An Education, which stars Peter Sarsgaard and won the world drama audience award and world drama cinematography award at the festival. Sony Pictures also acquired home entertainment rights to cop drama Brooklyn’s Finest, with a theatrical release through partner Senator US. “Most buyers operated intelligently with the right mix of caution and aggressiveness,” said Steve Bersch, president of Sony Pictures Worldwide Acquisitions Group. Other acquisitions reported by the Times and Entertainment Weekly include Anchor Bay Films forking over $3.5 million for Ashton Kutcher starrer Spread, Fox Searchlight spending $1.5 million for love story Adam, and Lionsgate acquiring for $2 million North American and British rights to Winning Season, starring Sam Rockwell as a girls’ high-school basketball coach. Meanwhile, Warner Bros. premiered the Amy Poehler comedy Spring Breakdown; Warner Premiere will debut the direct-to-video release April 9. CLASSIFIED SHOWCASE CO M P U T E R S O F T WA R E PA C K A G I N G P E O P LE I MPRM UPS THREE mPRm Public Relations, which handles various media and entertainment accounts, has promoted three senior managers. Susan Yin was promoted to executive director in the digital media and technology field, while Chelsea Hettrick and Leif Helland were both promoted to account supervisors in general entertainment. USED TAPES & DVDS I SUE PROCKO PR GETS ORR Sue Procko Public Relations has hired entertainment industry veteran Kimbirly Orr, naming her to the newly created post of VP of business development. She will explore new business opportunities such as expanding the company’s events division. — Billy Gil REDUCING YOUR INVENTORY? FOR ADDITIONAL INFORMATION CONTACT: Kurt Wohlman (714) 338-6749 kwohlman@questex.com www.homemediamagazine.com We Buy VHS, and also DVD & Video Games xtreme deo E 733-7370 (203) Vi February 2–8, 2009 Home Media Magazine http://www.homemediamagazine.com http://www.Blockbuster.com http://www.rapidrental.com http://www.homemediamagazine.com
Table of Contents Feed for the Digital Edition of Home Media Magazine - February 2, 2009 Contents News TV DVD Health/Fitness Reviews Pipeline Research Top 20 Sellers Top 20 Rentals and Top 10 Charts Just Announced Home Media Magazine - February 2, 2009 Home Media Magazine - February 2, 2009 - (Page Cover1) Home Media Magazine - February 2, 2009 - (Page Cover2) Home Media Magazine - February 2, 2009 - (Page 1) Home Media Magazine - February 2, 2009 - (Page 2) Home Media Magazine - February 2, 2009 - (Page 3) Home Media Magazine - February 2, 2009 - (Page 4) Home Media Magazine - February 2, 2009 - Contents (Page 5) Home Media Magazine - February 2, 2009 - News (Page 6) Home Media Magazine - February 2, 2009 - News (Page 7) Home Media Magazine - February 2, 2009 - News (Page 8) Home Media Magazine - February 2, 2009 - News (Page 9) Home Media Magazine - February 2, 2009 - News (Page 10) Home Media Magazine - February 2, 2009 - News (Page 11) Home Media Magazine - February 2, 2009 - TV DVD (Page 12) Home Media Magazine - February 2, 2009 - TV DVD (Page 13) Home Media Magazine - February 2, 2009 - Health/Fitness (Page 14) Home Media Magazine - February 2, 2009 - Health/Fitness (Page 15) Home Media Magazine - February 2, 2009 - Reviews (Page 16) Home Media Magazine - February 2, 2009 - Reviews (Page 17) Home Media Magazine - February 2, 2009 - Reviews (Page 18) Home Media Magazine - February 2, 2009 - Reviews (Page 19) Home Media Magazine - February 2, 2009 - Pipeline (Page 20) Home Media Magazine - February 2, 2009 - Pipeline (Page 21) Home Media Magazine - February 2, 2009 - Top 20 Sellers (Page 22) Home Media Magazine - February 2, 2009 - Top 20 Sellers (Page 23) Home Media Magazine - February 2, 2009 - Top 20 Rentals and Top 10 Charts (Page 24) Home Media Magazine - February 2, 2009 - Top 20 Rentals and Top 10 Charts (Page 25) Home Media Magazine - February 2, 2009 - Just Announced (Page 26) Home Media Magazine - February 2, 2009 - Just Announced (Page 27) Home Media Magazine - February 2, 2009 - Just Announced (Page 28) Home Media Magazine - February 2, 2009 - Just Announced (Page Cover3) Home Media Magazine - February 2, 2009 - Just Announced (Page Cover4)
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