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Old 03-03-2012, 11:30 PM   #1756  
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Originally Posted by Kosty View Post
Well they probably would not have a lot of confidence in any projections like that anyway as the studios do not control retail price points and overall revenues anyway. Retailers do.

The studios care less about overall retail revenues than they do with wholesale revenues and units anyway.

But you are just fooling yourself if you think that the strength of releases was not considered. Or that the studios care more about their own growth and revenues and profits that that of some overall industry metric. Industry trends and metrics are important but what is vastly more important are the more specific performance levels at individual companies or for individual releases over time.
Studios have undoubtedly cited Home Video weakness as an issue.

It has played a role in studio staffing and in new release budgets.

The issue is real. The impact is real. It is only through spin that it is constantly attempted to be downplayed.
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Old 03-03-2012, 11:41 PM   #1757  
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Sony isn't the only company that has invested in Bluray. I brought up several areas of investment. And you have been disagreeing with those who have said Bluray has been a financial disaster. Now you are going to say who cares when asked if Bluray is a financial success?

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Who cares?

The studios. consumer electronic manufacturers, replicators, retailers and smaller content providers or consumers do not care on bit on what return on investment Sony got off the research and development and deployment of Blu-ray.

Plenty of companies, most in fact, were content to let Sony take all the risk to solve all the problems with Blu-ray and now happily take the benefits and make money off the format.

Its an academic question that no one cares about and probably no one would ever know for certain. But with Blu-ray being a mass market success and with the PS3 and its royalty stream being a successful console Sony certainly did better than if the PS3 and Blu-ray had been an market failure or short termed format like HD DVD.

Sony DADC and Sony makes plenty of money on PS3 console games, Blu-ray Disc and DVD replication and royalties as well.

But most in the industry would not give a damn about what Sony invested to get Blu-ray going. Retailers nor consumers don't care either.
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Old 03-03-2012, 11:54 PM   #1758  
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Originally Posted by Malanthius View Post
Sony isn't the only company that has invested in Bluray. I brought up several areas of investment. And you have been disagreeing with those who have said Bluray has been a financial disaster. Now you are going to say who cares when asked if Bluray is a financial success?
Blu-ray is clearly a financial success for most companies involved it it now. Lots of people are making money off of Blu-ray now.

The who cares is concerning the theoretical question of whether or not it was a good or bad investment for Sony that did the bulk of the risk in developing Blu-ray. Most other companies invested by comparison far less in Blu-ray and make more and more money off the format as time goes on on the shoulders of Sony's investment in the format.
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Old 03-04-2012, 01:38 AM   #1759  
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The studios would be worse off if Blu-ray didn't exist, therefore Blu-ray is a success.

Keepin' it simple, as they say...
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Old 03-04-2012, 01:56 AM   #1760  
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Sony, not Blu-ray, is in the red because they chose to incorporate expensive tech including Blu-ray and Cell in their game console.

It's not like the studios are forwarding their Blu-ray profits to help Sony get out of the red. The studios are happy every day that they have Blu-ray versions to mark up and re-release.

Sony's losses are completely irrelevant to the studios in this present day.

Last edited by cakefoo; 03-04-2012 at 02:00 AM..
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Old 03-04-2012, 02:17 AM   #1761  
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I know you are going to actively promote Blu-ray here, but even you cannot expect to ignore facts and not get called on it. Hell, I don't even give the BDA that pass.


I was talking full year performance. Full year.
And so was Kosty. Q1 and Q2 affect the yearly total a great deal. Being at 7% YOY growth with half the year over was kiiind of a huge setback...

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Including the release of the crown jewel of catalog series with an exclusive 2011 BD release - Star Wars. Including a massively successful summer blockbuster sequel getting a Blu-ray only sell through release window.
The sales week of Pirates drew a lot of attention, and I'm pretty sure you were around when that discussion took place, lurking or posting, or posting elsewhere. We all agreed that it didn't help much at all, with the Blu-ray selling maybe a couple hundred thousand more than normal.

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Old 03-04-2012, 03:36 AM   #1762  
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Studios have undoubtedly cited Home Video weakness as an issue.

It has played a role in studio staffing and in new release budgets.

The issue is real. The impact is real. It is only through spin that it is constantly attempted to be downplayed.
Who is downplaying it as a issue? HMM talks about it all the time and the decline in DVD sell through is brought up all the time in the trade.

The only issue here is the fixation that Blu-ray is the problem as opposed to being part of the solution to the continuing loss of the DVD revenue stream over time along with digital options.

These recent comments at HMM do not downplay there are issues and concerns.

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Ownership Makes a Comeback


27 Feb, 2012
By: Stephanie Prange




We can thank a glittering vampire for injecting some new vigor into the sellthrough business. The latest “Twilight” movie, Breaking Dawn — Part 1, sold 5 million disc units in its first 11 days of release, according to Summit Entertainment, which is owned by Lionsgate. The studio last week announced disc sales of the title are about 13% ahead of sales of the third film in the franchise, The Twilight Saga: Eclipse, at the same point in its release.

Breaking Dawn — Part 1 helped push overall disc sales revenue for the week up almost 20% from the same week the previous year, according to Home Media Magazine research. The last up period was the week ended Nov. 12, which included the debut of another juggernaut, Harry Potter and the Deathly Hallows — Part 2. The lesson: Consumers continue to collect the big hits in large numbers and are interested in owning them on disc.


Meanwhile, the cloud-based digital storage platform backed by five of the six major studios continues to add consumers (see story, cover). Consumers have redeemed UltraViolet digital rights to more than 1 million title copies, according to research firm IHS, with 50,000 new accounts opened since early January.

“One million [UV titles] may not sound like much compared to the 504 million movie discs sold in 2011,” said Tom Adams, analyst at IHS. “However, we have projected that only 19 million digital film files were sold during the entire year of 2011 by electronic sellthrough (EST) vendors like iTunes, Xbox Live and Vudu. This suggests that if UV can continue to gain momentum this year, it could encourage consumers to buy more movies.”

Also, considering the small number of films offering UltraViolet at the moment, it seems use of the service cannot help but pick up speed. I know UltraViolet has come up against a wave of criticism from consumers and industry observers, but the fact that it is gaining accounts in spite of that criticism is a very good sign — and an indication that consumers want to own, not just rent, content digitally. Where EST has faltered, UltraViolet may succeed.

Ownership is staging a comeback.

http://www.homemediamagazine.com/ste...makes-comeback

From the HMM blog section:

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Universal Misses the Big Picture

1 Mar, 2012
By: Erik Gruenwedel


Universal Studios Home Entertainment president Craig Kornblau should know the halcyon days of DVD sellthrough aren’t coming back anytime soon.

It’s a rental market where consumers can watch new-release discs for $1.20 a night, with studios getting pennies on the transaction.

So why assist in the destruction of sellthrough (and studios’ bottom line) by extending — not lengthening — the 28-day embargo with Redbox? Why not join Warner Home Video in doubling the embargo to 56 days? After all, it was Warner that first windowed new releases to kiosks and by-mail subscription — a practice Universal and 20th Century Fox Home Entertainment embraced.


Obviously, Universal thinks the current window has the right economics. But considering that operating cash flow at Universal Pictures plummeted more than 95% in 2011, is the status quo really working?

The studio recently said Oscar-nominated adult comedy Bridesmaids was the top transactional video-on-demand title in history, generating $40 million in revenue across multiple digital platforms, including iVOD, pay-per-view, hotel viewings and electronic sellthrough. The movie also generated $100 million in disc sales.

Those tallies — which approximated nearly 50% of the title’s domestic box office — began accumulating 28 days before Bridesmaids was officially available at Redbox.

Now suppose Bridesmaids wasn’t available at Redbox for 56 days — ignoring for the sake of argument any workaround program. A typical transactional VOD purchase generates seven times the margin of a kiosk or by-mail subscription rental. Sellthrough generates 20 to 30 times the margin of a kiosk or by-mail transaction.

Bridesmaids was a popular movie with enduring demand; why give it to the 99-cent store just four weeks after street date?

Kevin Tsujihara, president of Warner Home Entertainment Group, was asked Feb. 29 why a consumer should pay $18 for a sellthrough title when a $2 (48-hour) rental edition existed down the street. Tsujihara said the only way to justify sellthrough was by creating scarcity of supply when demand is greatest — a basic tenet of supply-side economics.

“Otherwise, $2 beats $18 every time,” Tsujihara said.

http://www.homemediamagazine.com/eri...es-big-picture

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Analyst: Disc-to-Digital Has to be Free for UltraViolet to Work


2 Mar, 2012
By: Erik Gruenwedel



Movie studios — led by Warner Home Entertainment Group — want to push consumers toward sellthrough and cloud-based digital locker UltraViolet by encouraging them to transfer their existing disc collections into digital files.

BTIG Research analyst Richard Greenfield believes Walmart could be the first retailer to announce a disc-to-digital service. He said studios want consumers to frequent authorized retailers to initiate digital transfers rather than in the home due to concerns multiple users could upload the same disc.

Kevin Tsujihara, president of WHEG, Feb. 29 told an invester group he envisions big-box retailers such as Walmart and Best Buy offering services whereby consumers could bring in their discs and have them transferred seamlessly into digital files stored in the cloud.

Tsujihara said there are about 10 billion movie discs in U.S. households (about 90 to 100 discs), of which he said about 20% are Warner titles when factoring in the studio’s market share in home entertainment.

Indeed, discs (DVD and Blu-ray) are not serialized, which means it would be impossible to determine if a disc being uploaded to the cloud was an original purchase, or traded or shared from someone else.

“If consumers want to steal and share digital versions of movies, that is incredibly easy today without the need for discs,” Greenfield wrote in March 1 post. “Whereas sharing/stealing via disc-to-digital would be far more complicated than a simple Google search.”

Greenfield says studios should enable consumers to transfer discs to digital files for free rather than estimated prices ranging from $1 to $3 per DVD and upwards of $10 to transfer into high-definition.

The analyst said that for UltraViolet to work in a market increasingly shifting toward low-margin rental options such as Redbox kiosks and subscription video-on-demand, consumers need extremely low barriers to entry.

“We believe disc-to-digital needs to be done at home at no cost to the consumer, including a free HD quality upgrade, if UltraViolet is to have any hope of success,” Greenfield wrote.

Separately, he said rollout of UltraViolet has to be accompanied by the price of electronic sellthrough for new movies dropping to $10 with day-and-date theatrical premium VOD priced from $20 to $30.

“In a world where a wide array of content is available anytime/anywhere at increasingly low prices (think iVOD, VOD, Redbox and Netflix) or even free, as part of existing subscriptions (think HBO GO, Showtime Anytime and Streampix), we believe buying is not worth [three to four times] the cost of renting,” Greenfield wrote.

http://www.homemediamagazine.com/dig...let-work-26581

Last edited by Kosty; 03-04-2012 at 03:41 AM..
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Old 03-04-2012, 09:20 AM   #1763  
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And so was Kosty. Q1 and Q2 affect the yearly total a great deal. Being at 7% YOY growth with half the year over was kiiind of a huge setback...
I said as much and changed my year end projection from ~40% (which I believed at the beginning of 2011) to ~20% after H1.

Kosty called that pessimistic. So even after knowing H1 number, Kosty was stating that 20% yearly growth was too low a projection for BD. Now he uses H1 as an excuse.

Typical Kosty behavior. Always downplaying actual performance and its impact, while projecting growth that is simply not occurring.

100% pure PR BS.
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Old 03-04-2012, 09:27 AM   #1764  
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Who is downplaying it as a issue? HMM talks about it all the time and the decline in DVD sell through is brought up all the time in the trade.

The only issue here is the fixation that Blu-ray is the problem as opposed to being part of the solution to the continuing loss of the DVD revenue stream over time along with digital options.

These recent comments at HMM do not downplay there are issues and concerns.

http://www.homemediamagazine.com/ste...makes-comeback

From the HMM blog section:

http://www.homemediamagazine.com/eri...es-big-picture

http://www.homemediamagazine.com/dig...let-work-26581
I never stated Blu-ray is the problem.

But I do speak the truth. Blu-ray failed to meet expectations. That is a fact.

One that gets met with a dissertation of spin every time it is stated. Someone really wants to bury that fact.

Even after we know it failed to meet studio exec expectations as expressed at the end of 2008.

Even after it received tons of studio support in 2011, and still only grew a measly $350 million and barely covered 17% of DVDs attrition.
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Old 03-04-2012, 11:02 AM   #1765  
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I said as much and changed my year end projection from ~40% (which I believed at the beginning of 2011) to ~20% after H1.
Then why in conversations about what impacted 2011 sales, are you bashing the argument of weak first half releases negatively affecting growth, if you yourself just just acknowledged they had a large impact?

The same time that you discredit that argument, you cite Pirates as being a noteworthy positive impact-- yet Pirates only benefited Blu-ray maybe $4-5M. It did virtually nothing to reverse the negative impact of the weak releases.

Let's talk about the positive and negative impacts with proper weighting attached, shall we?
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Old 03-04-2012, 11:09 AM   #1766  
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Originally Posted by PSound View Post
I never stated Blu-ray is the problem.

But I do speak the truth. Blu-ray failed to meet expectations. That is a fact.

One that gets met with a dissertation of spin every time it is stated. Someone really wants to bury that fact.

Even after we know it failed to meet studio exec expectations as expressed at the end of 2008.

Even after it received tons of studio support in 2011, and still only grew a measly $350 million and barely covered 17% of DVDs attrition.
Everyone acknowledges that Blu-ray did not meet the higher end expectations that were initially set for it before any of the format wars began. What you need to do is understand that it doesn't make Blu-ray a blip on the radar or a lost cause or a failure.

We get reminded that Blu-ray "failed to meet expectations" every time we read your sig and every time you post there always seems to be some overall theme of Blu-ray failing to meet expectations. "Stop apologizing, it's a failure and that's all that matters." maybe to you and to your posse of haters, but to the studios, Blu-ray is a welcome excuse to charge more per movie and re-release their catalogs and make hundreds of millions of dollars each year to satisfy people's evolving tastes for picture and sound quality.

It's simply delusional to pretend like the format is a flop when it's generating hundreds of millions per studio, per year, and is still growing, with no replacement format in sight.

Last edited by cakefoo; 03-04-2012 at 11:21 AM..
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Old 03-04-2012, 03:50 PM   #1767  
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Everyone acknowledges that Blu-ray did not meet the higher end expectations that were initially set for it before any of the format wars began.
Really?

Because I recall Kosty stating emphatically that Blu-ray had not failed to meet expectations. And I have not once ever seen him state that it did indeed fail to meet expectations.
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Old 03-04-2012, 03:56 PM   #1768  
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Originally Posted by cakefoo View Post
Everyone acknowledges that Blu-ray did not meet the higher end expectations that were initially set for it before any of the format wars began. What you need to do is understand that it doesn't make Blu-ray a blip on the radar or a lost cause or a failure.

We get reminded that Blu-ray "failed to meet expectations" every time we read your sig and every time you post there always seems to be some overall theme of Blu-ray failing to meet expectations. "Stop apologizing, it's a failure and that's all that matters." maybe to you and to your posse of haters, but to the studios, Blu-ray is a welcome excuse to charge more per movie and re-release their catalogs and make hundreds of millions of dollars each year to satisfy people's evolving tastes for picture and sound quality.

It's simply delusional to pretend like the format is a flop when it's generating hundreds of millions per studio, per year, and is still growing, with no replacement format in sight.
You must be forgetting the numerous times various CEs etc. had "revised" their expectations for Blu-ray during and after the format war for players sold. So clearly expectations were set and not met.

As it stands, Blu-ray is failing faster than anyone could ever imagine. Consumers are just not interesting in buying movies on disc anymore. Not because Blu-ray sucks or anything, it's just a change in people wanting to own vs. renting/streaming/torrenting etc.
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Old 03-04-2012, 04:02 PM   #1769  
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Then why in conversations about what impacted 2011 sales, are you bashing the argument of weak first half releases negatively affecting growth, if you yourself just just acknowledged they had a large impact?

The same time that you discredit that argument, you cite Pirates as being a noteworthy positive impact-- yet Pirates only benefited Blu-ray maybe $4-5M. It did virtually nothing to reverse the negative impact of the weak releases.

Let's talk about the positive and negative impacts with proper weighting attached, shall we?
I am not discounting anything. Indeed it is because I acknowledge both positive and negative trends that I am able to shift my own expectations and honestly express when I have to change them based on actual market performance.

SIDE NOTE: The point of bringing up POTC is that an exclusive BD window was expected to be a strong positive for Blu-ray. Kosty believed it. Bruceames believed it. What happened is that the experiment was a failure. It did not boost Blu-ray much, and hurt the overall sell through performance of POTC. In retrospect we can see how poorly it did. But there was rough consensus before the release was that it would boost BD sell through revenue beyond simple BO strength for the week.


What I am discussing with Kosty is his consistent behavior to downplay current negative impacts as irrelevant to impacting current (and future) performance, and then using those same impacts as an excuse after the fact.

He dismissed H1 sub 10% performance during the end of and at the end of H1 last year, stating that they would not have a major impact on EOY numbers. Indeed, when I stated that the H1 performance changed my year end projection to 20% growth, he stated that it was "pessimistic" viewing.

Can you not see how that constant behavior of downplaying actual performance (and the impact of that performance) while using those as excuses after the fact is inconsistent? Indeed... it is the constant spin to always present the past as not as bad as it actual was, and to downplay current negative performance as not indicative of any cause for concern that I find distasteful.

It feels consistently insincere to try and dismiss information and trends when it is having an impact on a reporting period, and then to use it as an excuse when the actual impact is indeed negative (as was obvious DURING the reporting period).
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Old 03-04-2012, 05:04 PM   #1770  
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That is simply untrue. I never stated that the first half 2011 numbers would not have a significant effect on the overall numbers at the end of the year. They were always seen as a big hole that would have to be dug out of even with better releases that might occur in the year.
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