Warner Brothers is planning to bring out a handful of its films on DVD just a few days after it is released to cinema audiences. This is supposed to trigger an increase in sales of retail DVD products, or at least increase the sales for Warner Brothers.
Things like this are illusory and damaging to its own interests. The DVD market is down, that’s a fact, but it is the general fragmentation of video content of all types ‘ across the internet, on the handset, on DVDs, VoD to games consoles, and the like, which is causing all this. It is unavoidable and the only way to ride out such a storm is to ensure that you have all the bases covered, drive online advertising and have your content in every online store, and in every experiment.
Warner Brothers sees this move as patching things up with its retail partners, according to a na’ve piece in the New York Times this week. A long time ago you would have to wait years before a DVD of a major film came out. But as people have become lazy and distracted by other offerings (especially in the US and Western Europe) the number of full seats per cinema showing has gone steadily down, and this has resulted in an increased uptake in DVD players and viewing until the DVD makes up 75% of the revenue of some films.
As the exploitation windows have been brought closer and closer together, more film content has been ready for showing on DVD. So if once upon a time DVDs were coming out a year after the cinema, then by moving them to 9 months, for one short 12 month period studios were selling the DVD output of 15 months of production. This bolstered sales artificially, but also got consumers used to greater temporary choice. It also brought the promotional spend for the cinematic release closer and closer to the promotional spend for the DVD release.
By dropping that last 3 months gap between Cinema and DVD release, Warner Brothers will use up the last of its powder and will never again have a one year (or three months now) backlog of films that people have seen advertised, which their friends have seen at the cinema and which they have told them is a must not miss film, a time when DVD revenues ready to cut in.
Retail gets one more ‘fat’ season and then everyone can see that they can either spend half a day to visit the cinema, buy tickets and popcorn an coke at inflated prices, pay for petrol and parking to get there and still miss the crucial scene because they had to visit the bathroom at that point, or buy the DVD and watch the film two or three times at their leisure with the remote controller ready to replay any scene they ask for.
That move will hasten the drift away from cinema, and then the promotional spend of major films will get nothing at the cinematic release and all be dedicated at the DVD window, now just days later. Cinemas then go bust or turn away from the major studios and immediately internet release becomes the ‘only’ way to go, severing these DVD retail relationships forever. Short term thinking we’d say.
However there is a twist. Time Warner’s ‘Watchmen’ film set for a March 2009 release, made by the director who made the 300 will actually be rapidly followed up with a second film the ‘Tales of the Black Freighter,’ which tracks a side story line from the ‘Watchmen’ ‘ released 5 days after the film. It thinks that by making a second film at the same time, it can both get people to the cinema and get DVD revenue. What will it do when Watchmen arrives in DVD and most customers have already seen the derivative product. Same result, a lull in sales and an almost doubling of its film making and promotional costs.
All of this story is confused with the gradual shift to Blu-ray High Definition DVDs, which of course make more profit per disk and which take up an inordinate amount of retail space, and further confuse the consumer over which version to buy. This has retailers also confused about space allocation between the two formats, which has the potential to further crash the market.