DVD giveaways signal woes of once-booming format

[TheOMan]

Here's the link: http://news.yahoo.com/s/nm/20060817/tc_nm/media_dvds_newspapers_dc_1

DVD giveaways signal woes of once-booming format

LONDON (Reuters) - British newspapers are now giving away free as many DVDs as are being purchased in stores, revealing a stealth contributing factor to the decline of Hollywood's cash cow format.

The cover-mounted DVD giveaways, which have included "Star Wars" and "Donnie Darko," devalue the format in the eyes of consumers, one-quarter of whom said they would have bought the same title if they had seen it in shops for a reasonable price, according to a report released on Thursday.

In the first quarter of 2006, about 54 million DVDs were given away to British consumers who bought newspapers and magazines, about the same number as were sold by retailers over the same span, market research firm Screen Digest said, using data supplied by TNS and Ipsos.

That compares with 130 million DVDs that were given away in 2005 by the country's national newspapers, including the Daily Telegraph, the Times, The Sun and the Daily Express, and 211 million that were sold in shops.

Although most of the freebies are old and sometimes forgotten films, Screen Digest estimated that had they been bought the 2005 DVD giveaways would have represented 495 million pounds ($938.4 million) in retail sales.

In more realistic terms, if one-quarter of homes that received a free DVD each bought one additional disc a quarter at a deeply discounted 4 pounds each, additional UK spending on the format would have been about 50 million pounds.

That would have boosted DVD sales by 2.3 percent to 2.3 billion pounds, Screen Digest said, instead of the market staying flat for the first time in the nine-year history of the format.

"It's clear that that kind of quantity of free discs circulating in the market cannot help but have a dampening effect on the purchase of DVDs," said Helen Davis Jayalath, Screen Digest's senior home entertainment analyst.

Newspapers in other European countries, including Italy, France and Spain, also give away DVDs, but they typically charge an extra euro or two for the periodical when including one.

"Even though it's only a couple of euros, it helps maintain the value of the format in the eyes of consumers," Jayalath said.

There are other markets where DVD giveaways have caused controversy. In Greece, for example, retailers have appealed to the government to ban cover-mounts after one Sunday newspaper distributed the hit "Lord of the Rings" trilogy and two discs with extra material over a five-week span.

DVD sales came to a screeching halt across Europe last year, where they flattened at about 11.3 billion euros ($14.52 billion), after experiencing 41 percent growth in 2004 compared with 2003 and even more explosive growth earlier in the decade.

Deep price cuts have been the main culprit. The average price of a DVD in Britain fell 30 percent between 2000 and 2005.

Small gains in the United States and Japan helped lift global DVD sales in 2005 3.5 percent to $36.7 billion.

Although most of the major Hollywood studios oppose the newspaper giveaways, the smaller local distributors who have licensed the films are opportunistically doing deals with publishers for short-term gains that can generate as much as 250,000 pounds for a film.

"The argument in favor of this is that the majority of these films have reached the end of their commercial cycle," Jayalath said. "In many cases, they're no longer stocked because traditional retailers have a limited amount of space. For the rights holder, it can be the last bite of the cherry."

I guess we haven't really seen this in North America as we don't have newspapers that are giving away DVDs, but I can see how this would diminish the value of DVDs in consumer's eyes in Europe.  Very interesting.  It'll still be a while for me before I upgrade to an HDTV, DVD is still the next gen format for me.

Edit: I forgot to mention...that last line of the article in the quote is just odd.  I mean who takes a "bite" of a cherry?  How big is this cherry exactly?  Is it a mutant cherry?

[Van Cruncheon]

I had almsot NO DVDs until I started seein' 'em for $6.99 or $9.99 at QFC and Fred Meyer. Now I have over 200. Impulse purchases for the win.

[MrAngryFace]

Honestly DVDs cost what, 2 dollars to make? Im sure there's discounts for material purchases in bulk.

This maybe be a reason for a move to new formats, but it doesnt mean my 7.99 bargin hunting ass is ready to move on. I love my DVDs, bluray and hd-dvd can go straight to hell.

[heavy liquid]

Another large contributing factor (in my opinion) is that all of the big name movies have finally been released on DVD, and the majority of people are done upgrading their VHS tapes to DVD.  With no more big catalogue releases like Star Wars, Indiana Jones and The Lion King to propel sales, I don't find it surprising at all that sales have fallen.  I would argue that this has much more of an impact than cheap or free DVDs.

Now there's only recent movies like Pirates of the Caribbean and other blockbusters to really push the DVD sales.  This is why they keep re-releasing the same movies in an "Ultra-ultra EXTRA Edition!" to try and entice people to buy something they already own.

[MrAngryFace]

But until the costs of the new mediums and hardware come down in price they'll have to suffer the slump.

[Cheebs]

This is very true that people are done with the collections except for the handful of new movies that come out. This does NOT mean consumers are ready to upgrade.

VHS lasted 20 years and most of it wasn't filled with consumers buying an insane amount of videos for a collection beyond it's first few years.

People not buying many DVD's doesn't mean they are tired of DVD, they just got all the ones they like except for new releases.

[MrAngryFace]

If anything they SHOULD be taking less of a hit because DVDs are cheaper to mass produce, however they might have countered this benefit by making to fukin many.

[Eel O'Brian]

Honestly DVDs cost what, 2 dollars to make? Im sure there's discounts for material purchases in bulk.

This maybe be a reason for a move to new formats, but it doesnt mean my 7.99 bargin hunting ass is ready to move on. I love my DVDs, bluray and hd-dvd can go straight to hell.

[heavy liquid]

Well, as far as people upgrading to HD-DVD/Blu-Ray from their DVDs, I think people are going to be much slower in adopting to a new format than they were to DVD for a number of reasons that have already been covered ad nauseum.  Not enough people with HDTVs, it's too soon, etc.  But one of these is definitely what MAF brings up:  Price.  Which also ties in with the cheap and free DVDs.

Up until about five years ago, I had no problem spending $25 and up on DVD.  Of course I'd always shop for the cheapest price, but $25 was pretty average for a DVD.  $35 and up if you bought a Criterion.  Now however, I hardly ever spend over $15 and almost never above $20 for one.  The new formats are really going to struggle until people can pick them up at Target for the $10-$15 bucks they've become accustomed to.

[jobber]

the only shit I buy on DVD is tv shows like Reba and 24.

[Cheebs]

the only shit I buy on DVD is tv shows like Reba and 24.

Reba? wtf

[jobber]

the only shit I buy on DVD is tv shows like Reba and 24.

Reba? wtf

Reba >>>>>>>>>>>>>>>>>>>>>> any other comedy in the last 10 years

[The Fake Shemp]

I always warned CBS that 24 would cut into their Reba demographic.

[heavy liquid]

I always warned CBS that 24 would cut into their Reba demographic.

 

[jobber]

it was on the WB which we didn't get here until odd times during the night. After a few weeks of watching season 1 and 2, I got the DVDs. Now it's on Lifetime 4 times a day 

It should be back around January on the CW

[Cheebs]

If a show is on lifetime you shouldn't watch it.

[etiolate]

"Jobber, did I tell you you're muh favorite?"

[The Fake Shemp]

A black person watching the WB?  Say it ain't so, jobber!

[Vagabond]

Black people like EVERYTHNG on the WB :/

[Cheebs]

It's true.

[jobber]

If a show is on lifetime you shouldn't watch it.

My story is on Lifetime 

(Image removed from quote.)
"Jobber, did I tell you you're muh favorite?"

Barbra Jean: Aw, there's my Reba-Rooba-Roo!
Reba: [cheerfully] Call me that again and I'll slap the blonde right off ya!

Cheyenne: Kyra, guess what Elisabeth's first word was.
Kyra: Help?

Reba: Do you know what a teenager is?
Barbra Jean: A demon?
Reba: Do you know what a teenager is?
Barbra Jean: A demon... But I'm scared.
Reba: Of course you're scared - you're living with a demon!

Barbra Jean: [to Kyra] You bring people together. You're like a little Reverend Al Sharpton.
Barbra Jean: Maybe next time I'll marry someone who's ex-wife appreciates me!

Reba: Kyra, what on Earth would make you wanna hit someone?
Cheyenne: It's her way of showing affection.
Kyra: Yeah, that's right. Now why don't you come over here for a little hug.

Reba: I know what Kyra is doing!
Brock Hart: Like you did with Cheyenne?
Reba: Oh, one time! The one time our daughter gets pregnant and I never hear the end of it!

[Cheyenne, 18, is planning her shotgun wedding]
Cheyenne: Oh my gosh, honey, this is so much fun! We should have gotten married our junior year!
Reba: No, sweetheart, you were right to wait.

Reba: [when Kyra is helping B.J. feel better after she and Brock seperate] You're a beautiful young woman.
Kyra: Or maybe you just raised me right. And I watch a lot of "7th Heaven".
Reba: [when Kyra is helping cheer Barbra Jean up after she and Brock seperate] You are a beautiful young woman.
Kyra: Or maybe you just raised me right. That and I watch a lot of "7th Heaven".

Electrician: [to Barbara Jean, about Reba] Wow, your mom's a real grouch.
[Barbara Jean looks flattered]
Electrician: [pause]
Barbra Jean: I know, right?

Barbra Jean: Boop! You've got mail!
[opens Kyra's laptop and makes poses]
Reba: [to Brock] Boop! You've got a goof-ball!

Reba: You treat that animal like it can walk on water!
Barbra Jean: What is "dog" spelled backwards reba?
[conversation about why barbara jean's dog is missing goes on for another 2 minutes]
Van Montgomery: GOD! it spells god.

Cheyenne: [as Van eats cereal directly out of the box] Honey, what are you doing?
Van Montgomery: I'm trying to get the prize, and if I do it with my hands it's unsanitary.
Cheyenne: Oh, and that's a lot better than a giant bulging cereal gut.
Van Montgomery: [laughing] Oh! Ha,ha! You're funny, sweetheart. That's why I married you - your sense of humor. Oh wait, no. It was the baby.

 

[Cheebs]

WB has 0 good shows. Not one. Never has, never will.