Home Media Magazine - April 27 - May 3, 2008 - (Page 28) NEWS Kiosks Are a Good Rental Fit for Grocers Continued from page 1 www.homemediamagazine.com box kiosks, according to Leah Rodriguez, public affairs manager for Southern California Albertson’s. The trend is the same at SuperValu Inc., the Minneapolis-based parent of Albertson’s, which also owns Bristol Farms, Lucky, Bigg’s, Farm Fresh, Acme, Scott’s, Shaw’s and Shoppers. Rodriguez said the majority of stores were transitioning to kiosks while separately maintaining pointof-purchase (POP) displays and endcaps for sellthrough titles. She said rental traffic had dropped over the years, making the transition to third-party kiosks an economic necessity. “If we do have videos in stores, they’re for sale,” Rodriguez said. Rental kiosks are expected to represent 11% of the market by 2010, up from 4% in 2007, according to The Convergence Group, a Torontobased research firm. The Foothill Ranch Ralphs also maintained a sellthrough presence — in the frozen food aisle — with POP displays offering Warner Home Video and Sony Pictures Home Entertainment catalog fare from $9.99. Checkout stands featured new releases Juno from 20th Century Fox Home Entertainment and Cloverfield from Paramount Home Entertainment at $19.99 each. The chain is owned by The Kroger Co., the Cincinnati-based parent of nearly 30 supermarkets and convenience stores, including Pay Less, Food 4 Less, King Soopers and Foods Co. Jack Plunkett, CEO of Plunkett Research Ltd., in Houston, said grocery chains have exited the rental market as the industry evolved from mom-and-pop operations to national chains such as Blockbuster and Netflix that stressed convenience and selection. “Supermarkets are using the space for better purposes, like retail banking centers they rent out to Wells Fargo and others,” Plunkett said. He said the mini banks invite nongrocery foot traffic and give regular customers another reason to come to the store. “Endcaps still seem to work for selling — not renting — DVDs as impulse items,” Plunkett said. Food Lion’s high-tech Bloom supermarket chain, which jumpstarted the kiosk experience in 2006 when it revamped 40 Food Lion stores in the Washington, D.C., area with proprietary DVD kiosks, appears to have switched course. Food Lions stores offer only DVD sales. Bloom, which operates 61 stores through North Carolina, had mandated customers use a personal scanner to track purchase prices to speed up checkout, including DVD purchases and rental. The kiosks performed a variety of tasks, from dispensing product information to helping customers locate DVDs and conduct $1per-day rental transactions with the swipe of a credit card. Spokesperson Karin Peterson said the use of scanners had been scaled back to 28 stores. She said the proprietary kiosks were transitioning to Redbox units while sellthrough remained in-store. “We’re still renting for right now,” Peterson said. ‘Juno’ on the Run To promote the April 15 release of 20th Century Fox Home Entertainment’s Juno on DVD and Blu-ray, a group of runners styled after the track team in the film ran through New Photo by: Brian Ach/WireImage York’s Central Park April 14. VOD Venture Slated for 2009 Continued from page 1 Starbucks Changes Entertainment Focus By Erik Gruenwedel iting cost concerns, Starbucks Coffee is reorganizing its entertainment division to focus on digital music distribution and books. The Seattle-based coffee retailer said Ken Lombard, president of Starbucks Entertainment, had left the company to pursue other interests. Los Angeles-based Lombard was instrumental in Starbucks becoming involved in theatrical and DVD distribution, including the 2006 co-production Akeelah and the Bee with Lionsgate and Arctic Tale with Paramount last year. “As part of our ongoing transformation, we are committed to examining all aspects of our business that are not directly related to our core,” Howard Schultz, chairman, president and CEO, said in a statement. Chris Bruzzo, chief technology officer, has been promoted to SVP and will assume leadership of the entertainment category as part of his responsibilities. L ATE FL ASHES I ITUNES NUMBERS ELUSIVE Apple Inc. reported earnings of $1.05 billion for the second quarter (ended March 29), but the company made no mention of how well sales of iTunes store movies and TV shows were going. Revenue for the iTunes store was grouped with sales of iPod services and iPod accessories, and totalled $881 million for the quarter. Apple CFO and SVP Peter Oppenheimer noted in a call with investors that the Apple iTunes store has proven profitable for the company. He mentioned that music sales were strong. As for Apple TV, he said, “Our movie rental service has been well received by customers … and [we] will continue to expand video content internationally.” — Chris Tribbey I CDSA JOINS EMA DIGITAL DELIVERY COUNCIL The Content Delivery & Storage Association (CDSA) has joined the Entertainment Merchant Association’s (EMA) Digital Delivery Council, to establish metadata standards for the delivery of movies via the Internet. — Chris Tribbey I KOCH TO DISTRIBUTE CLOUD TEN PICTURES Koch Entertainment has landed the DVD distribution rights for Cloud Ten Pictures, the faith-inspired film production company. Releases will include upcoming films and the existing library, including the popular “Left Behind” series. Koch will handle home entertainment duties after Cloud Ten’s product is released theatrically and in churches via CNI Distribution, a division of Christian Network International that delivers faithbased media direct to churches. — Chris Tribbey Clarification: In last week’s story “Radiohead Approves ‘Best Of’ DVD” (HM April 20-26), the headline should not have implied the band approved the upcoming best-of DVD. It did not. I AMAZON MEDIA SALES UP U.S. media revenue at Amazon.com, which includes DVD and digital downloads, increased 22% to $1.2 billion in the first quarter (ended March 31), compared to $990 million in the same period the year prior. CEO Jeff Bezos said he was happy with Amazon’s digital initiatives. “It is very early … the revenue — Erik Gruenwedel is there,” he said. MTV Networks. The new venture will make available movies from Paramount and Paramount Vantage that were released after Jan. 1, 2008, with theatrical and television content from MGM, United Artists and Lionsgate following Jan. 1, 2009. Philippe Dauman, president and CEO of Viacom, called the venture a “game changer for the industry.” Featured movies will include pending theatrical releases Iron Man, Star Trek, Pink Panther 2, The Curious Case of Benjamin Button, Shutter Island, G.I. Joe, The Love Guru, Valkyrie and The Maratese Circle. Catalog movies made available will include Braveheart, Forrest Gump, Reservoir Dogs, Crash, Monster’s Ball; movies from the “Godfather,” “James Bond,” “Rocky,” “Saw” and “Star Trek” franchises; and the films of Tyler Perry. The deal also includes original joint TV series productions. It wasn’t immediately clear whether VOD access to the titles would be prior to, same-day or following the DVD releases. In addition, it remains to be seen how cable and satellite-TV operators will react to carrying another entertainment channel. “It takes a while to put something like this together,” said Jeff Pryor, MGM EVP of corporate communications. Pryor didn’t comment on DVD but said the venture will release additional announcements in the coming days. “This is a true next-generation premium content offering for the consumer,” said Jon Feltheimer, co-chairman and CEO of Lionsgate. The venture is seen as an attempt by the studios to forge more lucrative post-theatrical distribution than they reportedly get from Showtime Networks, which is owned by CBS Corp. Indeed, published reports said former Showtime executive Mark Greenberg would head the VOD venture. Showtime CEO Matt Blank had said he preferred paying for catalog movies and original TV content, compared to underperforming feature films. With contract talks looming, Blank was loathe to re-up a deal for Paramount, MGM and Lionsgate movies that reportedly cost him $320 million in license fees last year. The cable network has had good success with Lionsgate-produced “Weeds,” as well as other original series such as “Dexter,” “Californication,” “The Tudors,” “Brotherhood” and “The L Word.” Indeed, among Showtime’s top 20 telecasts in 2007, only two were movies, according to The Wall Street Journal. “We’ll be controlling our own destiny,” said a studio source familiar with the new venture. “We’ve had a very successful relationship with Showtime, and we’ll always keep the door open to them.” The studios’ distribution deal with Showtime expires Jan. 1, 2009. 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, Skokie, IL 60076-8270. Canadian G.S.T. number: 840033278RT0001, Publications Mail Agreement Number 40017597. Printed in the U.S.A. Copyright, 2008 Questex Media Group, Inc. All rights reserved. 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