The Return Of The Day-N-Date Dummies
It’s a very sad reality of the film industry that shiny objects often distract and amaze grown men in business suits.
Such is the still foolish notion of day-n-date releasing for wide release movies. As I write about in the entry on the MPAA and SOC last week, technology and bad financial times have once again emboldened some to reconsider the worst idea in the history of the movie business… a total collapse of the windows system in the form of all-platform say-n-date release.
Kim Masters gets into the issue with Bill Mechanic (as he did in our DP/30 State of The Union months ago) as he argues against the latest silly push towards day-n-date in some studio quarters.
And yes, Rich Ross and Comcast are the two leaders most likely to fuck it up for everyone.
But no, Sony’s Cloudy stunt has nothing to do with shutting down windows… it’s about trying to sell Blu-ray players, specifically the now $300 PS3, which Sony is losing about $200 on each time they sell one, but which they need to be in the consumer sphere for the long-term health of Bliu-ray as a format.
The math is not very complicated. DVDs didn’t become unpopular. The format matured and the price point became the issue. Even for just $15, a consumer spends at least 3x the cost of a rental to buy a DVD. How many times will they watch anything they buy?
Day-n-Date would not only eviscerate what is left of DVD sell-thru, but it would cannibalize theatrical, where studios generate about $5 for every man, woman, and child who sees a movie in a theater. With 3D, that number jumps to $7.50. No other form of delivery can come close to that spend per person. And given that the pricing on home ent is going the other way, it never will.
The scary thing is that The Industry, faced with a similar choice when DVD sell-thru took off, chose to forfeit what I estimate to be an average of about $10 million in theatrical on a studio release by front-loading and rushing to the DVD revenues. That always seemed a bit crazy. But the cash from DVDs was so overwhelming that there was a certainly unarguable logic to it. That’s changed.
But all-platform day-n-date would surely make a giant splash with the right studio movie… big numbers, right now. And someone is out there saying that the math works so that throwing away $20 million… $30 million on theatrical is worth the cost savings on the release (especially on marketing) and the benefit of sped up cash flow. The long-view problem is that when you start killing off platforms, you lose opportunity. And when the gimmick – like DVD sell-thru – matures, you start moving backwards again, looking for the next gimmick.
In my long held paraphrase of The Incredibles, when movies are turned into television, there are no movies.
Break down theatrical and there is no difference between any kind of filmed/video content. Great for the cinephile. Great for the long tail. Brutal for anyone trying to make a living by creating new content.
Theatrical matters. And not because of tradition and movie theater love, but because of business.
And ironically, no studio has more to lose than Disney, with Pixar films routinely doing $450m – $650m worldwide and still having a might post-theatrical life. If any studio should understand how many windows can be milked effectively, it is Disney.
Sigh…
Movies already ARE television. Where do you think the huge majority of the regular public ever experiences them? Most people get out to the movies a couple of times a year, but they definitely watch plenty of them at home.
The future of theatrical is event driven. It’s about getting more bang for your bucks. There will ALWAYS be theatrical for TRANSFORMERS 2 and 2012. And maybe exhibitors will learn how to turn back into showmen and give us proper presentation if there’s serious competition from day and date for smaller or mid-range movies.
But you grossly underestimate, Devin, the significance of theatrical on the post-theatrical call to action.
And this notion that it’s only about “event movies” is wrong on its face. What’s one of the most profitable films of the year? The Hangover. And Star Trek is not profitable at all.
This “event only” think is another false mantra that has been accepted as real for way too long.
Yes, most people see most movies at home in some form. And they are used to waiting for them. And soon, they will have more choice and less to pay for the experience… which is exactly why theatrical is critical for all genres.
Except that THE HANGOVER was an event movie. Big comedies that play well in packed theaters will always be event movies, just like big action films and big musicals and even big weepies. PRECIOUS is an event movie.
It’s damn expensive to go to the movies, and I mean that in terms of the whole thing for your average person, from babysitter to popcorn. The theatrical experience is, for your average moviegoer, a hassle. Unless a movie demands to be seen with a crowd, they just won’t bother doing it. And I can’t blame them. Nobody needs to go to the theater to see THE ROAD.
We’re at a place where things are shifting, and just saying day and date is dumb is missing the point. We’re entering a world that’s going to be a whole bunch of different delivery systems, and the idea that a movie is only something that plays at a movie theater is long since passed.
And by the way, railing against this is like being in 1999 and bitching about MP3. That cow is out of the barn. The thing the industry needs to do is figure out how to profit on this, not shit their pants about it endlessly like the music industry did. The music industry got nailed because they refused to be forward thinkers and didn’t understand that the days when you dictate to the consumer how they consume your product is long, long over.
I’m not sure that Sony is still taking a $200 hit on every PS3 sold. That may have been the case at launch (over three years ago now) with there being not enough of the expensive blue diodes to go around (the console’s worldwide rollout was shunted back to the Spring of ’07 because of this). Now, with the original breez-block units being superseded by the PS3 slim, and the original 60g model long since out of production, it’s no longer the case.
I’m with Devin 100% on this. Event movies will always have their opening few weeks but not every movie is an event and the ones that aren’t would (it seems to me) be wise to give people every opportunity imaginable to pay “top dollar” to see their movie as soon as possible. Devin in fact had a smart idea when he said “Paranormal Activity” should just cash in hardcore as soon as possible on the DVD turnaround and he’s right on that account as well.
Day and Date works amazingly for people oike me who don’t live in NY or L.A. and want to see a movie badly. A good example is “House of the Devil” which should be doing pretty well on-demand and in the small amount of theaters it’s in. Didn’t “Trick r Treat” get a nice sized per screen average due to buzz people were giving it having seen it on-demand? I don’t mind paying $10 for a movie I really, really want to see ASAP and don’t feel like waiting 3 weeks for it to hit my town.
Furthermore, the movie going experience SUCKS. It’s strictly for teens who want to screw around in the dark with their friends. If I could rent “Fantastic Mr. Fox” at home on my nice TV this weekend, I’d pay at least $15 to do so.
Another thing that is constantly overlooked in terms of movie theater box office is people paying for one movie then jumping theaters to see other movies. When I saw “Zack and Miri” it was a packed house of KIDS who wanted to see it so they paid for Harry Potter or whatever and snuck into “Zack and Miri.” That movie tanked hard but I think it was well attended.
If you think that The Hangover would get an event release in your notion of an event-driven theatrical world, you are deluding yourself.
And Don, I am perfectly cognizant of your personal needs – and the many, the majority, like you – but we’re not discussing what is best to fulfill your needs, but what will move an industry forward.
And no, Devin, this is nothing like mp3. No one is fighting technology. That is a bullshit argument used by people who want to turn this into what it is not. The technology is not the issue. It’s coming. Everyone knows it is coming. And no one is fighting it. The issue is maximizing revenues. And maximizing revenues is what keeps it all going.
The corporations would like nothing more than to go back to the old studio system where everyone was under contract, did what they were told, and made 4 movies a year, the vast majority of which was treated as product in a pipeline. If you think it’s bad now, keep pushing for this. You may get what you want… but nothing like what expect.
Why do you define window by location instead of price? Why assume that just because content is available for home at the same time as theatrical that the theater has to be at a significant disadvantage?
Going to the movies for a family of 4 is $50-$100 depending on eating habits and ticket prices. Why not price an at home ownership experience on Day 1 @ $60 just like video games? The price is within the range that there will be people going to go theatrical for its benefits, but now you have a significant trade-off between price, convenience, and best experience. Also, people attending theatrical should be able to walk out of the theater and buy a disc or download code for a small incremental fee. There is no rental experience during this period, and at least with digital, no secondary sellers market.
4-6 months later its out of theaters and the at home price drops to $15-30 it is now, depending on dvd, blu-ray, or download.
It at least something to think about instead of just saying nothing but what is being done now can work.
“Going to the movies for a family of 4 is $50-$100 depending on eating habits and ticket prices. Why not price an at home ownership experience on Day 1 @ $60 just like video games?”
People will absolutely not spend $60 to see a movie at home.
But they’ll pay $60 for a boxing or UFC fight Wrecktum? People part with their money in weird ways….
A one-time-only sporting event is completely different than a film. Studios can’t count on “weird ways” to grow revenue. People are conditioned to spend $8-15 dollars a ticket at the movies but it’ll take more than simple convenience to expect them to plunk down similar money for a home-viewing experience.
The video game price of 60 dollars is pure and utter bullshit. How those fucking 25% Good and 75% SHIT video game developers continue to get away with that garbage, is beyond me. Especially given the fact that they hardly ever make a game that’s worth 60 bucks! I love having a new Tekken game, but it sure as hell was not worth 68 bucks total with tax. Seriously, 60 bucks for anything, is too god damn much.
Now, if you want a price point, then go with 20 bucks. 20 bucks for something you usually ask 10 bucks for, makes the most sense.
20 bucks for Day and Date VOD might work. 30 bucks might work, but some one has to do it at some point. If they do do it. The studios should make them one week deals. Each week, you get a new movie, and each week the new releases show up.
Video game developers don’t get away with it. Electronic Arts just wiped out 1,400 staff across their various studios, including 60% of the staff that created the Warhammer Online title that sold over a million copies last year.
If you think the film scene is looking painful, you haven’t been reading the tech headlines.
When studios were hot, a few years back, for day-n-date, it was based on the notion that they could get “fight prices” for home delivery on opening day… and without the freedom to save the film on the dvr… one view only.
They did surveys. They did tests. They came to the realization – which I always said was obvious – that they could not get fight prices, except in very limited situations.
Harry Potter 7, yes. 95% of releases, no.
One view only would be utter bullshit since it’s not a live event. $60 for an ownership experience day and date seems the only workable strategy for a higher gross opening window. Ever been surveyed or tested?
If you can’t get $60 dollars on opening day to own, seems like you likely aren’t getting those people in the theater anyway. When a family of 4 blows $50-100 going to the theater for non-digital, non-IMAX with nothing to show for it except their memories, seems credible they would spend $60, a more profitable $60 gross to the studios, some of the time to own at home opening day instead.
Defending theatrical windows at all costs is already on a slippery slope to lower profitability. Attendance has been on the decline for years, and ticket prices continue to rise to offset the attendance decline. As prices rise, attendance will continue to decline. I am not saying compared to other entertainment, even at these rates, theatrical isn’t good value. But eventually a tipping point will be reached where theatrical starts to accelerate the attendance decline due to higher prices and habits will be permanently broken. There will be no resetting with a release at home strategy then to a price point somewhat comparable to theatrical today, the $60 price may already be too late.
I am just basing this on my own personal experience. My theatrical attendance has drastically declined with the addition of children. Babysitters are hard to find and costly. I would have easily elected to own @ $60 day and date with theatrical several releases. I would have gone to the theater and then paid $60 to own Star Trek before this coming Tuesday when I will pay $20 on iTunes and download in 720p HD. I have a PS3, but the convenience of having the film easily accessible on Apple TV, the laptops, the iPod touch and iPhones for the kids makes the higher picture quality of blu-ray something I can sacrifice. Beside, I’ll get the public library copy some time, they’ve been carrying blu-rays.
IOIO – are you a gamer? I am. While $60 bucks is a lot of money, SOME games are more than worth that price, especially considering how deep some games are with their multiplayer option.
Playing games like Assassins Creed, and Uncharted 2, I often just stare at my screen in amazement. You pay 30 bucks for a blu-ray right? I do. And what do I get out of it after watching it twice a year? I’ll gladly pay twice that and interact with my HD game any day of the week.
murdocdv, I think you shouldn’t use your personal experiences to extrapolate to what an average audience would do. The average moviegoer doesn’t post on industry-related blogs. Unlike you, a lot of average moviegoers just bring their kids into the theaters with them, so little junior gets to watch Apocalypto just like an adult.
People will not pay $60 for a movie. At least, not a regular movie playing in theaters. They’d just watch a DVD instead.
The Big Perm, I am not suggesting the industry should just take a flyer and boom, this is implemented next summer for every release, based on my family and the others I know.
OK, one more personal anecdote. I guarantee that my wife and her friend next Saturday would go see New Moon in the theater together and then would buy the $60 own copy for home. They can’t be the only ones.
The video game industry, and yeah I am a big gamer, should be mined as an example of the $60 launch price. Call of Duty: Modern Warfare 2 sold 4.7 million copies opening day (all systems), for revenue of around $282M. This is the biggest opening day in video game history. The game hasn’t even begun to stop selling, and as a society video games aren’t as popular as movies. US video game software sales hit $10.96B in 2008 compared to $9.85B for theatrical film on ticket sales of 1.37B.
So if, just playing with the numbers, 10% of theatrical ticket buyers (137M) would pay $60 to own during the launch window, that’s revenue of $8.2B/year. Let’s assume the presence of an ownership possibility during the launch window resulted in yearly theatrical revenue being cut in half to $4.9B. That is still $13.1B/year. You can play with scenarios like this all day long and you have to be very pessimistic running these numbers to end up with yearly revenue The Big Perm, I am not suggesting the industry should just take a flyer and boom, this is implemented next summer for every release, based on my family and the others I know.
OK, one more personal anecdote. I guarantee that my wife and her friend next Saturday would go see New Moon in the theater together and then would buy the $60 own copy for home. They can’t be the only ones.
The video game industry, and yeah I am a big gamer, should be mined as an example of the $60 launch price. Call of Duty: Modern Warfare 2 sold 4.7 million copies opening day (all systems), for revenue of around $282M. This is the biggest opening day in video game history. The game hasn’t even begun to stop selling, and as a society video games aren’t as popular as movies. US video game software sales hit $10.96B in 2008 compared to $9.85B for theatrical film on ticket sales of 1.37B.
So if, just playing with the numbers, 10% of theatrical ticket buyers (137M) would pay $60 to own during the launch window, that’s revenue of $8.2B/year. Let’s assume the presence of an ownership possibility during the launch window resulted in yearly theatrical revenue being cut in half to $4.9B. That is still $13.1B/year. You can play with scenarios like this all day long and you have to be very pessimistic running these numbers to end up with yearly revenue < ~$10B theatrical alone pulls in for the launch window. Just a thought experiment. I don't have to risk anything throwing theories out there. But my family can't be the only one that would spend $60 during a launch window to own a movie.
Nobody may need to go to the theater to see The Road, Devin, but it would be nice for those of us who still want to to have the option, which day and date would probably kill.
It seems like you guys are advocating for voluntarily eliminating a revenue stream. And it’s way premature to say that theatrical is all about “event” movies. Forget The Hangover – do you honestly think $33m domestic theatrical for Doubt was less important to Miramax than whatever it’s done in On Demand? But of course, if you’re defining Precious as an “event,” then that category includes anything that connects with an audience.
Also, seeing a matinee of Antichrist on opening weekend at my local Landmark cost $.49 less than it would have had I watched it on On Demand. So this “It costs the avg person $100 to see White Chicks” argument is an eye-roller.
Maybe to own a movie people might pay $60. A very small amount, I’d say. But still, the difference between a movie and a video game is that you buy a movie and maybe watch it a few times. The video game is interactive and some of those gamers will be spending a quarter of their waking life playing them.
Aris: it’s the quality issue. They charge 60 bucks for everything, when most of these games they put out are complete and utter shit. It’s not until BROKETOBER (dubbed by Angry Joe as the time in September and October where studios release their big games) where they put out games even close to being worth that price. Hell, do not even get me started on how most of these game sequels are just new maps and new graphics put on top of the previous game’s engine. It’s ridiculous that they want 60 bucks. Absolutely ridiculous.
Foamy: I know it’s bad out there, but they did this to themselves. They did it to themselves by putting out shit game after shit game. EA in particular represented the developer that most represented the ridiculous wasteful spending in this decade.
David, fight prices? Huh.
If movie theaters are already hanging in there on life support, and studios start running with this idea full tilt, what makes them think they’re even going to have a building left to house their theatrical windows after the revenue for the theaters gets gouged away by the move? Can they really be expected to live from one event movie to the next?
“Didn’t “Trick r Treat” get a nice sized per screen average due to buzz people were giving it having seen it on-demand?”
Nope. It didn’t do theatrical at all. Played some festivals, then direct-to-DVD quite a while later.
what about piracy and revenue dilution? Dont you think someone would pay 60 bucks for first day high res release and then posts it on piratebay and the such… Also isn’t it likely that teenagers would have viewing parties with their friends to dilute the $60 cost of a first view: 10-20 get together and pitch in 3-6 bucks to watch a first run…
Well, this SOC thing (linked in the entry) is one of the tools the MPAA is trying to roll out so they can try to stem piracy from any digital distribution to homes… basically shutting down any output on any machine other than to the TV.
And sure, there would be teens who might have viewing parties.
But anyone who has ever paid for a fight and invited friends knows that the hat doesn’t get filled. And the kids need their parents to be willing to be the one to fork up the $60.
Also, kids want to get out of the house and go to the theater. They are the main source of ticket revenue… which again makes my point.
The main audience that cares about opening day – aside from film critics and pundits – are younger people… who still go to the movies.
I’m not saying that day-n-date wouldn’t create revenue, but “fight pricing” will work once in every two hundred attempts.