DVD downturn panics film industry

posted by Michael Zoldessy on May 29, 2009 at 7:55 am

A drop in DVD sales is giving industry execs a scare as they contemplate whether they can keep selling the public bad movies.

If box office is booming, why are so many top studio executives brooding about the future of the movie business? Let’s just say that in today’s increasingly complex film world, the cinema gods giveth at almost exactly the same time as they taketh away.

The studio bosses who should be celebrating the unprecedented upswing in moviegoing at theaters — with theater box office up roughly 15% this year — have been getting a big dose of bad news from the other end of the food chain. DVD revenues have cratered in the past six or so months, dropping off (depending upon whose figures you trust) as much as 15% to 18% overall.

What’s really scary for studio executives is that DVD sales, which have traditionally represented the biggest chunk of pure profits in the business, were the real safety net when it came to greenlighting movies. In the past, if you had an action film that made $150 million in domestic theatrical box office, you could relatively accurately predict what that movie would make in DVD sales. But in recent months, studios have been alarmed to discover that there is often a dramatic fluctuation between box-office revenues and DVD performance, with the highest erosion often coming from the highest-grossing films.

Read the full story in the Los Angeles Times.

Comments (8)

markp on May 30, 2009 at 6:31 am

Now I may be wrong here, but did these high paid executives ever stop to think that people just have the money to buy DVD’s ?? I mean you hear about people losing their jobs, their homes, it amazes me that the movie theatres with their high prices are still doing well. Like I said, I could be wrong, but in our family, putting food on the table is a little higher priority right now than buying a DVD.

KenLayton on May 30, 2009 at 8:12 am

Exactly. It’s too expensive to go to the movies let alone buy a DVD.

JohnRice on May 30, 2009 at 8:58 am

The economy is definitely one factor in the DVD sales slump. I think another factor is that the novelty of movie collecting has sort of worn off for a lot of people, myself included. I mean why are why buying all of these DVDs and only looking at them once or twice? Wouldn’t it make more sense to just rent them on Netflix, check them out at our local library or Blockbuster? I say all this as a life long film collector (8mm, 16mm, 35mm, Beta, VHS, Laserdisc, DVD…and now Blu-ray!) and the owner of roughly 1500 DVDs…but with nothing on order right now. Hey I’m also running out of shelf space!

Cable and satellite and now even broadband internet delivery of movies has also had it’s impact, especially when the films (including some of the classics on Cinemax, HDNet and MGM HD) are presented commercial free in high definition. Once you’ve seen “My Fair Lady” and “Lawrence of Arabia” in HD it’s pretty hard to get thrilled about your old standard definition DVDs of those titles. Yeah I know there is Blu-ray but that’s a minority format so far and those titles I mentioned aren’t even available on that format yet. Everything even the black and white oldies looks better in high definition! You can of course see all the recent blockbusters on pay-per-view in HD with 5.1 digital surround sound not long after their DVD release.

Personally I think the glory days of DVD are gone for good and the studios are going to have to adjust for that!

moviebuff82 on May 30, 2009 at 9:41 am

Don’t forget the availablity of downloading movies onto a videogame console or high-end computer for watching and paying for it. If you don’t have cash, then sites like Youtube and Hulu offer uncut movies, although there are commercials on those videos and the quality is not HD but suitable for PC use for older computers. As for the DVD format, it will still be in use for recordable data such as movies, photo albums, and music as prices for that stuff go down while Blu-Ray is in its fourth year.

Luis Vazquez
Luis Vazquez on May 30, 2009 at 10:26 am

I could be wrong, but I believe that the increased revenue for movie goers is a result of higher ticket prices; especially for the additional charges for 3D presentations.

I used to be a frequent theater goer, but Hollywood just isn’t producing very many things that I want to see.

I never buy DVD’s any more. Why would I? I have never seen a movie that I own more than twice. If I feel like seeing something I go on “On DEmand” or Net Flix. Buying DVDs is a total waste of money unless you really think you will watch it 4 or more times or you have some emotional tie to the film We all have those special films.

As a matter of fact, I can’t actually remember the last DVD that I bought. It’s been years.

MPol on May 30, 2009 at 7:26 pm

I think there’s some truth to the notion that the glory days of DVD’s and owning movies outright has worn out some. Imho, it’s so much more fun to go out and see movies as they’re really MEANT to be viewed; on the great big, wide screen, in a REAL movie theatre, with the lights down low.

Btw—I don’t have a DVD player anyway, so it’s just as well, imho. I still go out and see films on the great big, wide movie screen, especially older classics.

vic1964 on June 1, 2009 at 6:59 pm

I don’t buy DVD’s anymore because i only want Blu-ray but most of the titles i want are yet to be released.
I am also very much over the idea of owning everything on Blu-ray if i have the DVD, just want my favorites movies only.

If the prices came way down on Blu-ray i would buy more but not like the DVD glory days where i had to have everything.

Roloff on June 2, 2009 at 3:28 am

I stopped buying DVD’s some time ago too, thinking I would replace them with Blu-rays too. But then I figured they take up too much shelf space (my house is tiny) for what I do with them (I watch perhaps 1 DVD a month) too, and I could indeed just borrow BD’s from friends or go for pay-per-view, not to mention the many movies that are waiting to be seen on my PVR. The necessity to own the film has passed, I’m less materialistic these days, and my guess is that this is happening worldwide, like the article mentions in the end. I also think that’s a good thing! I went through my 500 DVD collection and took a serious look, found 120 DVD’s I felt I would never or perhaps watch again and donated them to the School for the Arts I teach at.
Time is also a great issue. So much to do, so much to see, and I don’t even have to pay to see a movie (as an art house manager/programmer, I have a special pass that allows me free entrance in any theatre in The Netherlands).

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