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'Marketplace' Report: Movie-Release Methods
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'Marketplace' Report: Movie-Release Methods

Business

ALEX CHADWICK, host:

From NPR News, it's DAY TO DAY.

Here in Los Angeles, some folks are thinking about big changes in the movie business. Releasing DVDs sooner, maybe even at the same time that movies are showing in theaters, because a new study in London, out of London today, says that such a move could actually make studios more money, maybe as much as 16 percent more money. Marketplace's Sam Eaton joins us now.

Sam, haven't these studies already tried this and - or the studios already tried this and failed?

SAM EATON: That's right, Alex. There is the case of Steven Soderbergh's movie, "Bubble." That was released a couple of years ago in the box office and on DVD at the same time as kind of a test case here. And unfortunately it took in about $200,000 in box office sales. So not exactly a case in point for this new study. But to be fair, industry experts say that Soderbergh's film is a hard when he uses a barometer as to whether this pushing up the release date for DVDs will work. What they say is what's needed is - to really see how this will play is to do it with a much bigger movie, something with a much wider audience appeal.

CHADWICK: Well, so they should try it with something like the "The Departed."

EATON: Exactly. And if they do, that leaves the big question of - basically the stakes here for the film studios couldn't be higher. They're making about 60 percent of their film revenues from DVD sales. So you know studios are definitely looking into this question. The main driver here is curbing piracy, which has been taking a bigger and bigger chunk of their profits. And the argument goes, if you close the window between the theater and DVD release of films, you give these pirates less time to knock off copies.

CHADWICK: That kind of makes sense. The study is predicting a rise, maybe 16 percent rise, in studio revenues if they can close this opening window. So how do they reach these findings?

EATON: It's the Cass Business School in London that looked into this. And basically, the researchers looked in the film markets in the U.S., in Germany and in Japan. But entertainment experts here in the U.S. say the way that study was done, which is through audience surveys, suggests those numbers could vary pretty widely, since people don't always do what they say. I talked to Stuart Levine, who's with the Daily Variety, and he says there's another glaring problem with the study, which is making theater companies mad. The study also says simultaneous DVD sales would cut theater chain profits by about 40 percent.

Mr. STUART LEVINE (Daily Variety): I think they're in such bed with the theater corporations that they really don't want to upset these people. Because if this operation and this, you know, test case doesn't work, then they're going to ultimately really going to upset the theater owners, and they have to be in bed with theater owners. The theater owners are what's making the money.

EATON: And there's already somewhat of a precedent for this. Four chains, theater chains in Germany and the U.K. pulled the film "Night at the Museum" after Fox decided to release the movie early on DVD.

CHADWICK: So Sam, do you think we'll see these changes?

EATON: You know, it's probably more of a hybrid, Alex. The study also says there's a win-win scenario, which is to give studios three months of exclusive rights. And it says if they do that, we'd have a seven percent gain in profits.

CHADWICK: Thanks, Sam. Sam Eaton from Public Radio's daily business show Marketplace, from American Public Media.

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