Well, here is a bit of news a little more serious than what I normally write about. However, it’s interesting to see how this situation could completely change the way we, as movie fans, see newly released films.
In a report put out by Variety six of the seven biggest Hollywood studios are making a push to offer movies in homes on digital download only weeks after a movie is released into theaters.
Nothing is set in stone yet, but apparently when discussions first started it looked like the studios would make their digital downloads available 17 days after the film debuted in theaters for the low, low price of $50. However, some studios, particularly Fox and Universal, feel that $50 is too high of a price to ask consumers to pay for a digital rental. Therefore, they are trying to convince other studios to make movies available between 30 to 45 days after the theater launch and only charge $30 as the rental price.
The one studio not interested in these talks is Disney – due to not wanting to shorten the time window that a particular movie can stay in theaters. This is no surprise that Disney has zero interest in this deal due to owning the rights to Marvel, Star Wars, and all their animated movies. These properties tend to have runs in the theaters longer than any other property put out by any other studio. A deal like this could actually hurt profits for Disney.
There are two interesting things about this plan that are complicating talks between the studios.
The first is the amount of ideas being circulated. There are too many ideas being thrown out by all the parties involved and they are constantly in flux. One particular idea the article mentions is where movies could be made available for rentals at a higher price and as theaters give the movies less and less screen time the rental prices drop. This would allow people to choose to pay a higher price for a rental in the film’s first weekend of release, or wait a few weeks then pay a lower rental cost. There is also the issue of, “is every film created equal?” Should big franchise movies be priced, and launched within the same time window as smaller independent films? These are all issues the studios need to iron out before any major changes are made.
The other complication is studios trying not to violate anti-trust laws. Due to these laws, studios cannot work together to sign deals. If they did it would cause a monopoly in the film industry. Because of these anti-trust laws the studios must reach agreements with each participating chain on an individual basis. Two studios heads talking about a deal is okay. But you can’t have all six participating at the same time in the same room. This has not only made discussions complicated, but it has made it lengthy as well.
If this deal comes to pass, and I believe within the next five years it will, studios are not the only businesses that will be affected be the changes. Movie Theater chains (AMC, Regal, Cineplex, ect.) will have to completely change with the times or risk closing their doors. A change like this that allows for digital downloads to become available quicker would definitely cause a drop in theater ticket sales. Also, forcing a studio to shorten its release window for a major blockbuster is not going to help. This deal would mean a theater like AMC would be forced to show an X-Men movie for only 3 to 4 weeks instead of the normal month-and-a-half to two months a movie of that stature sees in theaters today. So, while the studios will make more money from digital rentals that cost more than the average movie ticket, theaters will suffer due to loss in revenue if they don’t find a way to draw big crowds on opening weekends.
Personally, I don’t know what I think about this kind of a deal. I’m not one who downloads a lot of content, and I like buying physical DVD’s and going out to see a movie in the theater on a big screen. However, I also know that I am in the minority. Digital downloads for the majority of the movie watching population are currently the biggest thing since tummy rubs, and it is becoming more and more popular with every passing year. In order to cater to these changes the studios that make the movies have to do something in order to gain the biggest profits. That’s business, and I get it.
Yet, it seems like theaters chains, at least from what I can tell, are going to suffer the most from such a dynamic change. We will definitely see smaller theaters close their doors, and the big theater chains are going to have to raise ticket prices in order to keep up with less people buying a ticket and staying home. Concessions will definitely become more expensive. And theaters will show less and less smaller films in order to get more screens that show big blockbusters. These are all predictions mind you, but I don’t think they are that far off the mark.
But what do you think? Are you a traditionalist who needs to see a movie in the theater? Or are you someone who would like a digital rental three weeks after a movie has been released? Leave a comment below and we can make a discussion out of it.