AfterDawn: Tech news

Hollywood unhappy with lower-priced DVDs

Written by James Delahunty (Google+) @ 03 Oct 2007 5:14 User comments (16)

Hollywood unhappy with lower-priced DVDs While Hollywood insists on only tapping its feet in the waters of the digital download market while it continues to milk physical movie sales to feel safer, major retailers are starting to upset the movie studios by offering ultra-low-price DVDs, even outside of the fourth quarter. With physical movie sales declining, retailers are trying to keep the DVD buyers coming to the stores by offering DVDs as cheap as $3.99.
Target and Circuit City are two retailers that are offering DVDs at this "rental" price. Target customers can buy such movies as The Nutty Professor and Along Came Polly for $3.99, while customers at Circuit City can pick up The Bourne Identity and S.W.A.T for the same price. VideoBusiness points out that 0.8 percent of catalog sales were in the $3 to $4 range as of 2007, compared to 0.4% as of 2005 and 4.6 percent of catalog sales in 2007 were in the $4 to $5 range, compared to 0.7 in 2005.

However, movie studio executives don't agree with what the major retailers are doing for DVD prices. "It's a negative precedent in the business to do that type of lower budget pricing outside of the fourth quarter," Warner senior VP Jeff Baker said. "You would need to see some uplift in unit volume velocity to compensate for that lower pricing to maintain profit margins, and I have not uniformly seen at retailers the necessary uplift in volume."

Keeping prices of DVDs attractively low adjusts consumer expectations of DVD prices. Retailers benefit from offering great discounts to their customers as it brings them to the store, where they hopefully will not just leave with a couple of DVDs.

Source:
Ars Technica

Previous Next  

16 user comments

13.10.2007 7:27

This is where the hollywood douchebags are retarded. I dare say that I'm not the only one here on a budget with a family. When you have a wife and kids to feed, spending $12 to $20 on a on a DVD or two, or three, every paycheck, is mostly a luxury that will cause something else to suffer. I don't buy DVDs anyway, just rent them by mail, because if I've seen it once, it's enough for me except for really good movies which are few and far between. There's too much material out there to watch the same stuff over and over.
If they want to charge high prices when the movie is new, sure. The money is made on the new and cool factor. however I think this is a wise move on the retailer's part. They may sell 3 movies to every person that walked in to buy one ($12.00), instead of one movie to say two-thirds that walked in ($13.99 or so). Out of 12 people, they made $144, whereas thy would have only made $126 with the the other price point. Now I'm aware of the variables, as I've worked retail for 5 years. My point is, like any "sale" or price cut, people will either stop and buy when they wouldn't have before, and/or they will buy several instead of one. This is great for the holidays too. I don't suddenly make more money to cover the gifts I want to get for my loved ones. Dropping prices sure makes me want to visit your store. Hollywood needs to wake p and smell the new flowers on the money tree.

23.10.2007 10:06

NICE!

Who needs High Def media when the prices of DVDs are like this. Grab some of these 3.99 movies and an upconvert player and you are set. Then we can wait 2 years until there is a def-inet hi def winner

33.10.2007 11:00
nobrainer
Inactive

Originally posted by c1c:
NICE!

Who needs High Def media when the prices of DVDs are like this. Grab some of these 3.99 movies and an upconvert player and you are set. Then we can wait 2 years until there is a def-inet hi def winner
dvd's all the way and is the winner of the format war.

http://hardware.slashdot.org/article.pl?...161218&from=rss

Originally posted by link:
"Early next month Panasonic is going to release a DVD recorder that can store HD content on standard DVDs. The new device is expected to be a boon for the backer of the Blu-ray format; Blu-ray uses discs several times more expensive than standard DVD media. While the DVD discs won't have the capacity of a Blu-ray disc, the content will be of similar visual quality. 'The company said it will start selling three models of new DVD recorders capable of recording full HD programs on conventional DVD discs on November 1. The high-end model with a 500-gigabyte hard disk drive is likely to sell for 130,000 yen, Matsushita said.'"

43.10.2007 12:09

http://seekingalpha.com/article/21558-a-...mashing-success

Redbox at McDonald's promotion will cause more and more people to stop paying retail when they can get new releases for only $1! lol

This message has been edited since its posting. Latest edit was made on 03 Oct 2007 @ 12:10

53.10.2007 13:07
WierdName
Inactive

This is just business. That's the way it works. If you went to a fair and were charged $20 for a ride, maybe one or two people would ride it but no much/any more. If your prices are too high, your not gonna get customers and your business will bomb out. The retailers are just catching on to this while Hollywood is still looking at charts too afraid to lose a buck or two in order to keep their jobs.

63.10.2007 14:24

Sell all new DVDs for $4 and piracy will drop drastically. Do not do away with physical media, I'll be damned if I'm gonna pay for something that I can't hold in my hands.

73.10.2007 18:08

Originally posted by BludRayne:
Sell all new DVDs for $4 and piracy will drop drastically. Do not do away with physical media, I'll be damned if I'm gonna pay for something that I can't hold in my hands.
Too bloody right. Haven't we noticed that the emperor has no clothes on?

We pay for nothing - no videos, no software, no phones etc etc. And, what is worse, we get *bleep* all in the way of warranties and guarantees - try reading the EULA, basically it tells you you get zilch and if their product stuffs up anything of yours then it's ships biscuit - hard tack.

And even though we end up with nothing in our hands we are being expected to pay more for it PLUS we will need to by gear that will suit DRM (Down Right Miserliness).

Still we have to make sure that ceo's get their millions in golden handshakes when the ought to get sod all in golden showers.
This message has been edited since its posting. Latest edit was made on 13 Oct 2007 @ 6:45

84.10.2007 12:04
duke8888
Inactive

It seems the studios want it both ways high prices and more profits screw them. The $3.99 price is very reasonable and affordable for many. This would stop the bootlegging of movies as bootleggers aren't going make their profits and they won't find it profitable to sell them.

94.10.2007 12:53
nobrainer
Inactive

Originally posted by duke8888:
It seems the studios want it both ways high prices and more profits screw them. The $3.99 price is very reasonable and affordable for many. This would stop the bootlegging of movies as bootleggers aren't going make their profits and they won't find it profitable to sell them.
its the easy way to stop piracy, lower the costs to rid the world of bootleggers, who are the ppl making money from piracy but it won't happen because profit margins need to be much greater!

104.10.2007 17:42

Screw Hollywood! Unless it is a great blockbuster, like Transformers, I never buy new releases at $14 or $15! In fact, out of my entire movie collection of 100 DVDs, I have less than ten that I paid more than 10 bucks for! Let's hear it for cheap DVDs!

114.10.2007 20:12
ericg8
Inactive

They should be blowing those b*tches out!

In 5 years, they'll all be garbage. Everybody will clamour to replace with hidef.

For that price, people will start collecting like books

125.10.2007 3:48

These are your typical high paid morons. They would rather sell 50 DVDs at $20 having the stores keep $18 and they get $2 than sell 1,000 and have the stores get $2 and they get $2. The could care less about profit as long as the customer gets screwed.

135.10.2007 21:12

I guess neither retailer is selling the DVDs in question at a loss so how does it affect the industry.

What profit a retailer wants to make is his own business.

146.10.2007 1:56
nobrainer
Inactive

in the uk tesco http://www.tesco.com/ our largest retailer like wal-mart is very fierce in undercutting and is able to do so because of the purchasing level of the company. They will not stock blu-ray, hd-dvd or do not they sell ps3's off the shelf unlike all other hardware, so will the dvd survive and lower prices prevail, well the consumer is always right and tesco supplies to demand!

This won't make the studios very happy, as with the price drop of dvd's as it stops the uptake of the new formats, and ppl aren't purchasing their collections again on a new format, whats that saying "new money for old rope"?

This message has been edited since its posting. Latest edit was made on 08 Oct 2007 @ 11:22

158.10.2007 3:42

Jeff Baker say he is right f@ck the customer, we are only here to make him rich.

169.10.2007 19:46

this is the law of inflation and deflation come on this is common sense hollywood makes enough anyway.

Comments have been disabled for this article.

News archive