Hollywood braces for talks on DVD releases

Mon Mar 15, 2010 7:39pm EDT
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By Alex Dobuzinskis

LOS ANGELES (Reuters) - Top Hollywood executives and theater owners will seek this week to resolve a brewing dispute over DVD release schedules, a contentious question as the industry grapples with shifting viewer patterns and the advent of high-tech home entertainment.

At the annual ShoWest convention in Las Vegas, starting Monday, studio moguls and the country's largest theater chains hope to reach an understanding on the so-called "window" between a movie's screening and when its DVD is released.

The Walt Disney Co started the ball rolling when it announced it would push up the DVD release of its "Alice in Wonderland" by four weeks -- prompting threats by some theater chains to boycott the hugely marketed film.

Analysts say Disney and other studios want to reduce marketing expenses, adapt to audience's increasing need for on-demand content and boost flagging DVD sales. But theater owners, already facing the roll-out of 3-D TV as a potential competitor, have reacted nervously as studios such as Disney and Time Warner Inc's Warner Bros start to tinker with DVD release schedules.

Theater owners are fighting to protect ticket sales, which have decreased to 1.42 billion in 2009 for the United States and Canada from 1.57 billion in 2002. Chains such as Regal Entertainment Group and AMC Entertainment Inc are fearful that, if studios shorten the window, they could lose even more customers as audiences wait to watch films at home.

Matthew Harrigan, an analyst with Wunderlich Securities, said theater owners fear losses ahead.

"This is nothing right now, but people see a foot in the door. That's what got people spooked," Harrigan said.

Already, Warner Bros, is considering shortening the release window for its adventure movie "Legend of the Guardians" due out in September, said a source familiar with the situation.   Continued...

<p>A Redbox automated DVD rental kiosk is seen in Golden, Colorado September 16, 2009. REUTERS/Rick Wilking</p>