Originally posted on Filmography
There have been a number of articles about the movie industry reducing the time between a film appearing in the cinema and being available on DVD of late. The reasons given tend to be cost (you spend less on advertising), piracy (it gives pirates less chance to get illegal copies distributed) and potential earnings (the DVD market is worth more than the box office). It was only a matter of time before someone announced that they would be releasing a film in the cinema and on DVD at the same time (hat tip: Kottke). That time has come. In fact, in the deal proposed, the movie would also be released on TV as well (I assume on pay-per-view).
I have long thought that it would make sense to offer the DVD for sale at the same time as releasing in cinemas because when I come out of a screening all charged up and excited after seeing it, I’m far more susceptible to impulse buying it I imagine, rather than having time to cool off and forget about it (I don’t tend to buy DVDs the minute they’re released anymore, in the knowledge that, given a couple of months, the price will have halved). Unfortunately, the best I could come up with was some sort of voucher scheme whereby you could only buy the movie on DVD with a voucher/ticket stub that you could only have got at a cinema screening. That way you’d drive business to the cinema, avoid the loss of any box office takings and probably increase your sales of the DVD, all while helping the word of mouth as people talk about it. This doesn’t help when you think of repeat visits.
Many of the films (if not all) in the top ten box office takings list had a certain percentage of people going to see it more than once at the cinema. The first film I saw more than once at the cinema was Robin Hood: Prince of Thieves (twice). Since then, there have been others: Jurassic Park (four times), Saving Private Ryan (three times), Star Wars Episode I and Episode II (at least twice each), Harry Potter and the Chamber of Secrets (three times), Lord of the Rings: The Two Towers (two or three times) and I’m sure there were others. So by allowing people to buy the DVD immediately you would a) reduce the number of repeat visits that person would make(if they planned to) and b) probably reduce the total number of people going to see it at the cinema as the less eager would just borrow a friend’s DVD. On the flip side of course, is the fact that you may increase the number of people buying the DVD and paying the top price for it (you may even be able to charge a premium), thereby making a much higher percentage from the DVD.
A ticket to my local cinema costs about £6.50, a DVD typically costs £14.99 (unless you wait, like me, and get them for £7.99). I seem to remember hearing that the cinema chain kept about 65% of the ticket price, which leaves about £2.25 for everyone else. A DVD costs peanuts to press, but take away the money for the distribution and the cut for the retailer and you’re probably left with about £10. That’s four times what you make on a cinema ticket, give or take a little. So, as long as a quarter of people who would have gone to see the movie, buy a copy, you’re in the money. Now we’re all starting to understand why the studios are looking at DVDs in a new light. They’re also looking to the future and a number of studios are already looking into downloadable films, I can certainly see the issue of special download access codes becoming a real possibility. The studios can then sell direct to their customers, cutting out the middleman and keeping more money for themselves while offering the product at lower prices.
I don’t think you’ll ever see cinema screenings disappear, possibly not even decline. They still have massive technical advantages (i.e. huge screens, expensive sound systems) and a social aspect (we like going out to places rather than staying in all the time, going to the cinema makes it an event) that you cannot compete with in your living room. I do think that DVDs being considered as a separate product (to the studios at least) will stop and that time to market will reduce even more, as will the offset of global release dates to a certain extent, especially as travel becomes even faster and easier.
I’m glad to see that the film industry is finally waking up to the fact that we are rapidly entering an ‘on demand’ society where people want the ability to watch whatever they want, whenever they want and not just when someone dictates that they can. The BBC has already done this with it’s radio shows, offering the ability to ‘listen again,’ and have mentioned their desire to do the same with their TV shows. I don’t think it’ll be long before any media provider can afford not to offer their shows this way.