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Hollywood Studios Ponder Releasing Films On Demand Just Weeks After Theatrical Openings

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Six of the largest movie studios in Hollywood have begun making plans to distribute their films by way of on demand services just a few weeks after the films have been playing in theaters worldwide. While first run movies rarely make it to an on demand or pay per view situation sooner than three months after playing, the studios are looking to recoup some revenue as DVD sales continue to avalanche downhill.

Warner Brothers and Fox have begun to aggressively market the concept by approaching exhibitors with an offer of having them make films available on demand just 17 days after they have opened at theaters. Warner Brothers thinks a $50 per film price tag is something consumers would be willing to pay rather than to shell out $9 just a couple of weeks before at a theater. Other studios, like Universal and Fox, are so not so quick to pull that trigger. They both think that $50 is a bit too high and are looking at more like $30 per download. A few of the studios think that offering the films within 30-45 days with a $30 price won’t be too shocking to the average consumer.

The studios seem to believe that it will also save them on advertising costs as a closer on demand release date will forgo another heavy round of trailer advertising and promotion for the released films. They also think that they can attract the younger audience, the teens as well as the 20 and 30 somethings because they know these generations want what they want when they want it. They are regular users of the streaming services and don’t usually have to wait a few weeks or months to see something.

Disney has no interest in considering anything but the current status quo while Paramount, Sony and Lionsgate have begun to put out feelers and queries. Disney tends to produce Marvel, animated features and Star Wars and it knows that those types of films tend to have long runs at the theaters and tend to play better on the big screen. Another business model being considered is to release the films for on demand once a film has reached a threshold of theaters. The fewer the theaters it begins to dribble down to, the sooner the films will get released for on demand.

The distributors and exhibitors, however, are leery and they don’t want the home entertainment business model toppled or fooled with by the studios. At least they don’t want that anytime soon. The negotiations are, for certain, in the early stages. But, if both sides can see a profit without too much upending or uproar, a deal will likely materialize sooner than later.

Mr. Sawyer is a freelance writer, editor and journalist from Tampa. He has written thousands of articles for hundreds of magazines and news sites on countless topics including science, the media and technology. He is also the author of many white papers, special reports and ebooks covering a wide range of subjects.
Kevin Sawyer
Broadcast Beat - Production Industry Resource