Tuesday, September 28, 2010

Movie Studios Think We'll Pay $30 To Watch New Movie Releases At Home

Sony Pictures, Warner Bros. and Walt Disney Co. are reportedly in talks with In Demand, Cox Communications, Comcast, and Time Warner to offer customers the option of watching newly released films in the comfort of their own homes for as much as $30 per showing. According to the reports the new releases would be available, via Video-On-Demand, shortly after hitting theaters and several weeks before being releases to DVD.

Testing for the new services has already begun with Sony Corp. testing the market with users of its Bravia TV by offering the Will Smith movie “Hancock” in 2008 and the animated film “Cloudy with a Chance of Meatballs” in 2009 for $24.95. Time Warner Inc. Chief Financial Officer John Martin told the Goldman Sachs conference in New York last week that the company’s Warner Bros. studio expects to begin tests on the service later this year. He said he expected the offering to be priced at $20 to $30 per viewing.

The major question is why would consumers opt for such a high priced single viewing service option? Well for one, if you are a larger family (3 or more) and the movies are released within a shortened time frame the $30 cost could actually save you quite a bit over in theater costs. Ticket prices have been skyrocketing over the years with adult tickets costing well over $10/person and kids tickets averaging well over $6/child.

The National Association of Theatre Owners, a Washington-based industry group, is obviously opposed to the idea of offering the new VOD option stating “Any promotion, advertising, marketing or testing of premium VOD needs to be done within the existing in-home window time frame [of the exclusive 120-day theatrical “window” exhibitors have for a typical release]."

The NATO is concerned that any deviation from the 120-day theatrical window would not only affect ticket sales but also undercut the value of "theatrical exhibition".

I for one don't see this as being a very viable option. Personally rising ticket costs and expenditures have kept me out of theaters over the past few years and I don't see that changing anytime soon. So I don't think I'd be willing to shell out an additional $20-25 just to see a movie that has already been in theaters for a few weeks. I'd be perfectly willing to wait the extra time saving me my hard earned cash to see a new release on DVD or Blu-Ray as apposed to spending the extra money for thew VOD service.

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