Period between DVD and video on demand releases shrinks

Fri Aug 20, 2010 2:00pm EDT
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By Georg Szalai

NEW YORK (Hollywood Reporter) - The window between the average movie's DVD and video on demand release has shrunk to just five days, down sharply from the 30 to 45 days that were common a few years ago, according to broker dealer BTIG's media analyst Richard Greenfield.

Most movies are already being released day and date on DVD and VOD amid an accelerating shift over the past six months to DVD rentals rather than purchases, he said.

"The studios' willingness to collapse the VOD window is a clear sign to us that the industry is admitting that DVD purchasing is disappearing," he wrote in a note to investors on Thursday.

"Consumers simply do not need to own the overwhelming majority of content released by Hollywood, when that content is so readily available via rental platforms."

Greenfield noted that some studios are making DVDs available to Redbox or Netflix without a 28-day waiting period that other studios have used.

"What drives us nuts is how certain studios (Disney, Paramount and Sony) allow Redbox and Netflix to offer their content day-and-date with a DVD's release, but put a window on VOD," he said.

He said that video on demand is more profitable on a per-unit basis than Netflix or Redbox offer the studios, not to mention traditional rental stores such as Blockbuster."

After 2007's first day-and-date VOD release experiments between cable operators and studios led by Time Warner, "the number of VOD day and date with DVD releases more than tripled in 2008, however, most studios focused on their weaker titles that they believed were less likely to be purchased by consumers," Greenfield wrote.

By the end of 2009 though windows were being reduced or eliminated even for blockbusters, with holdouts Sony, Disney and Paramount also increasingly shortening windows.

"2010 has seen an even more rapid reduction in the DVD-to-VOD window, with our table of 77 releases/to-be-released movies on DVD and VOD yielding an average window length of only five days, with the vast majority of movies now VOD day-and-date with DVD," Greenfield wrote.