Tuesday, 12 April 2011

Hollywood Babble On & On #710: Is It Worth It?

There's a hell of a lot of chatter about the "Premium Video On Demand Service" being set up by a coven of four studios (20th Century Fox, Sony, Universal & Warner Bros.) that will allow people to stream movies at home, via DirecTV, just 60 days after their theatrical opening for just $30 a movie. Google's think-bots seem to think that it's viable, but are unsure about the price, meanwhile the theaters, pissed over losing their precious release window are hatching all kinds of retaliation plans, from boycotting movies released under this plan, to reducing the number of trailers they show, to putting flaming bags of dog poop on the front steps of Studio CEOs all over Beverly Hills.

The question I have to ask is: Is it worth it?

Now that question has two meanings. One meaning is for the consumer, and the other meaning is for the companies behind this plan.


Okay, let's play a little thought experiment and
imagine that the service is up and running, and the telemarketer has just interrupted your dinner to tell you that it's available in your area.

Do you really think it's worthy to pay $30 to see a movie 60 days after its theatrical opening, when, if you waited a few more weeks, you could see it, and literally dozens more, via Netflix screening for $7.99 a month?

Or barring that, buying it on DVD, usually for less than $20, and have the extra features that film buffs enjoy.

The coven's main selling point for this VOD plan is the simple fact that going to see a movie in a theater is a pain in the butt. You have to get there, burning precious gasoline, or paying for public transit. If you drove, you have to get parking. Then there's your ticket, snacks, and after the show is over, there are the various and sundry expenses to get your butt home. If you have kids, then it's a whole other nightmare, because society seems to frown on just locking them in a cupboard until you get home.

But in the theater, you have it on a big screen. One that fills your vision from one edge to the other. You also miss the social aspect of being with a crowd of people, the extra electricity of an opening night, and the subtle pleasure of just getting the hell out of the house and interacting with other human beings once in a while.

Sure, you could invite people to come join you when you drop the $30, but the decision to stream a VOD movie is usually a spur of the moment thing, brought on by overwhelming ennui over the vast wasteland of television. If you're going to hold a "Watch A Movie At My House" party you have to take into account the need for a really bitching home theater system, plus food, beverages, etc..., to make it worth the while of your friends and family to attend over just streaming it at their own home.

Now you must ask yourself, is all that really worth it?

Now onto...


The guys who thought up this plan are probably thinking they are really clever fellows. Setting up the service won't cost all that much, and they don't have to share the revenue with pesky theaters, only DirecTV.

But the costs of setting up the service is just a short term, tangible, there are other, more intangible costs out there that could be a lot pricier.

I'm talking about making enemies.

As I mentioned earlier the owners of the big theater chains are plotting their vengeance. I wrote a while back that AMC and Regal are even opening up their own movie distributor, called Open Road, and NetFlix is starting to produce original content to compete with the studios that aren't putting out enough product to make up for the duds. The coven's DirecTV plan could put a turbo-charger on those plans, and if they succeed, they could seriously damage the major studios.

Remember, the studios suffer from a fundamentally dysfunctional business plan, that causes feature film production/distribution/marketing costs to rise, profit margins to shrink, and quality to suffer. If these new rivals break free from that dysfunctional tradition, and make movies that are reasonably priced with wide audience appeal, then the studios will have to deal with a dwindling market share as well.

So now they have to ask themselves: Is this plan really worth it?


  1. The think best thing for the industry at a whole is for a independent studio to make quality material at a modest budget to show up the Big Studio $500mil 3D mess that is overpriced SFX and no story.

  2. I almost never pay more than $25 for a movie on DVD, a medium I can keep physical ownership of. No effin' way I'm paying $30 for a movie I can't even keep.

  3. Dirty Dingus Sez:

    That it is a excellent plan!... To run all movie company business into a final grave! So that with the avant of HD cameras falling into more agreeable prices, smaller companies can produce More movies with less costs. Special effect driven flicks will have actual stories to provide the catch outside of typical hollyweird crap being squeezed out daily~ it's a all Win-Win scenario!!!

  4. I know that part of the plan is to run Netflix into the ground through shady legislation and court rulings - our current state of Net Neutrality pretty much allows for cable providers to start throttling access to certain bandwidth-heavy sites, such as Netflix, to help make VOD better-off. For some reason, the phrase 'vertical monopoly' never gets tossed around at these hearings.