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Old 02-14-2012, 02:56 PM   #1501  
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For some perspective.. H1 last year had a 16.1% drop in box office lead-in. At the time, Kosty was spinning like a top about the impact of a 16.1% delta in box office lead-in as an excuse for BD sell through weakness in H1.

And now he is spinning that a >20% increase in TBO lead-in is not significant? Please.
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Old 02-14-2012, 03:12 PM   #1502  
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This years TBO is more than 20% higher than last year (YTD). That is not close. Indeed, if it was down more than 20% you would be touting that as the excuse for Blu-ray weakness.


BD growth is actually TRAILING TBO lead-in strength. Spin away as you must, but don't expect others to ignore the facts.
The total difference is still only $122 million spread over many weeks and we really have not seen many if any weeks with large disparities where have a major movie that generated substantial box office went head to head against a weak week.

The Twilight release will be the first time that has happened all year like it was last year in the other direction a bit later in the 1Q sequence.

Most of the differences in the weeks are with titles grossing $35 M or $25 M or less which do not have a huge impact on packaged media sales or in genres that do not do substantial Blu-ray sales. January releases are pretty lame after Christmas.

TBO growth or trailing percentages do not directly translate into packaged media revenues anyway. Its a pretty gross correlation where the ratios or percentages can clearly have less effect than a wide percentage variation that actually represents a small magnitude change. Its not like the change YoY directly is a 1 to 1 match with the TBO variation.



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Old 02-14-2012, 03:24 PM   #1503  
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Flip Flop is hard at work!!!
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Old 02-14-2012, 03:41 PM   #1504  
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Flip Flop is hard at work!!!
Yep.

Last year a 16% shift in box office lead-in was significant enough to explain an undoubtedly weak and unexpected H1 10% Blu-ray sell through growth.

But this year a 20% increase in TBO lead-in is no big deal?

I call bull shit.
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Old 02-14-2012, 03:55 PM   #1505  
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Yep.

Last year a 16% shift in box office lead-in was significant enough to explain an undoubtedly weak and unexpected H1 10% Blu-ray sell through growth.

But this year a 20% increase in TBO lead-in is no big deal?

I call bull shit.

Right back at you.

Right now we at five weeks are talking about a $120 M magnitude difference with the difference mostly in $25 M titles.

At last year after 1Q and through the 2Q we were talking about over $1 Billion worth of box office difference with 1H 2010 having Avatar, Twilight: New Moon and Alice in Wonderland being major tent poles that had no analog in 1H 2011. The raw magnitude and the power of the releases make a difference. $120 M spread over 5 weeks in January with $30 M titles being the difference moderated by the residue sales of December is not the 1H disparity of last year.

The TBO difference this year is having an effect, in the weeks we have seen 14% and 27% YoY gains for Blu-ray and Blu-ray has been up every week this year.
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Old 02-14-2012, 04:13 PM   #1506  
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Right back at you.

Right now we at five weeks are talking about a $120 M magnitude difference with the difference mostly in $25 M titles.

At last year after 1Q and through the 2Q we were talking about over $1 Billion worth of box office difference with 1H 2010 having Avatar, Twilight: New Moon and Alice in Wonderland being major tent poles that had no analog in 1H 2011. The raw magnitude and the power of the releases make a difference. $120 M spread over 5 weeks in January with $30 M titles being the difference moderated by the residue sales of December is not the 1H disparity of last year.

The TBO difference this year is having an effect, in the weeks we have seen 14% and 27% YoY gains for Blu-ray and Blu-ray has been up every week this year.
Just More PR BS.

Look.. Everyone knows magnitude of TBO will increase over the course of the year. Which is why percentage shift within a specific reporting period is a valid metric. One that is PR BS proof. Which is why you are working so hard to discount the impact and releveance of box office lead-in.

Sorry, but even your masterful spin technique cannot discount the relevance of box office lead in for a reporting period.
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Old 02-14-2012, 04:28 PM   #1507  
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That seems like very weak growth based on box office lead-in.

Indeed, BDs YoY growth of 12.6% is very weak based on the box office lead-in strength 2012 vs 2011.

On the surface, it doesn't look encouraging when the box office lead-in is up more than Blu-ray is for the year (20.8% vs. 12.6%). Last year whenever Blu-ray was in a low teens or single digit growth phase, it was because of negative BO lead-in.

I think this is the first time that box office YoY has exceeded Blu-ray growth for such an extended period of time.
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Old 02-14-2012, 04:51 PM   #1508  
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On the surface, it doesn't look encouraging when the box office lead-in is up more than Blu-ray is for the year (20.8% vs. 12.6%). Last year whenever Blu-ray was in a low teens or single digit growth phase, it was because of negative BO lead-in.

I think this is the first time that box office YoY has exceeded Blu-ray growth for such an extended period of time.
Yep. And I know there are always other factors to consider.

But there is no denying that BD is underperforming compared to prior years when looking at BO lead-in.
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Old 02-14-2012, 06:01 PM   #1509  
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On the surface, it doesn't look encouraging when the box office lead-in is up more than Blu-ray is for the year (20.8% vs. 12.6%). Last year whenever Blu-ray was in a low teens or single digit growth phase, it was because of negative BO lead-in.

I think this is the first time that box office YoY has exceeded Blu-ray growth for such an extended period of time.
Why is that surprising? BD's growth pattern is on a downward trend. What is going to reverse that? Ultraviolet?

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Old 02-14-2012, 08:32 PM   #1510  
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Why is that surprising? BD's growth pattern is on a downward trend. What is going to reverse that? Ultraviolet?
Only the speed of the trend is surprising, not the trend itself. At $2 billion and change, it's a little soon for peaking.
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Old 02-15-2012, 09:18 AM   #1511  
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Only the speed of the trend is surprising, not the trend itself. At $2 billion and change, it's a little soon for peaking.
Could Blu ray already have peaked? When November rolls around, aren't the sell through revenue numbers adjusted down? This could result in the actual numbers being on par with or lower than last year.
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Old 02-15-2012, 09:33 AM   #1512  
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Could Blu ray already have peaked? When November rolls around, aren't the sell through revenue numbers adjusted down? This could result in the actual numbers being on par with or lower than last year.
If last year's numbers are adjusted down, it would have the opposite effect of making this year's number's look better. Sometimes I think that's the reason why they are adjusted downwards. After all, why are they always adjusted downwards and rarely (if ever) upwards? Can't be a coincidence.

As for BLu-ray peaking, I think it's getting close, but it still has a lot of DVD to feed off of, so it might be a few more years of slow growth. But it's really amazing when you think about it, that after the better part of 6 years, Blu-ray still has less than a 25% market share. I'll bet no one would have predicted that.
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Old 02-15-2012, 09:56 AM   #1513  
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But it's really amazing when you think about it, that after the better part of 6 years, Blu-ray still has less than a 25% market share. I'll bet no one would have predicted that.
Predicted? There were no expectations for Blu-ray!
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Old 02-15-2012, 10:20 AM   #1514  
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Predicted? There were no expectations for Blu-ray!
That's right, I forget. Any sales whatsoever exceed expectations, when there are no expectations to begin with.

I was looking at the VHS decline and noticed that DVD did not peak until it had basically sucked VHS dry. In 2006, the year DVD peaked, VHS had only $400 million in revenue (likely nearly all of it rental), a drop from $2.1 billion in 2005. The next year VHS had only $100 in revenue, and DVD suffered its first decline.

But VHS didn't decline by large percentages until DVD was 5-6 years old, and then in 2003 sales started to fall off a cliff. It will be interesting to see if DVD sales start an accelerated decline even remotely to the extent of VHS.
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Old 02-15-2012, 10:40 AM   #1515  
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That's right, I forget. Any sales whatsoever exceed expectations, when there are no expectations to begin with.

I was looking at the VHS decline and noticed that DVD did not peak until it had basically sucked VHS dry. In 2006, the year DVD peaked, VHS had only $400 million in revenue (likely nearly all of it rental), a drop from $2.1 billion in 2005. The next year VHS had only $100 in revenue, and DVD suffered its first decline.

But VHS didn't decline by large percentages until DVD was 5-6 years old, and then in 2003 sales started to fall off a cliff. It will be interesting to see if DVD sales start an accelerated decline even remotely to the extent of VHS.
Right now it looks like it might be the opposite.

Instead of BD having positive cannibalization of DVD (like DVD did with VHS), both DVD and BD will just slowly wither away.
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