Dear Hollywood: Don't Be Idiots; Don't Delay Movie Rentals

from the seriously dept

Sometimes you just shake your head at ideas that come out of some executives that are just so incredibly dumb, it makes you wonder how anyone ever took them seriously. There have been some hints about this latest one, though. Just last week, in discussing the latest IP Colloquium podcast, we noted (with surprise) that Paramount’s top lawyer thought the solution to business model problems in the entertainment industry was “more windows.” Windows, of course, are the different time periods in which movies are released solely for different formats/media. So, it starts with the theater (the first window), followed by video, pay per view, cable and network TV — each representing another window, and another chance to squeeze more money out of the same content.

Yet, with the industry facing some challenges, rather than actually looking at what users want, its top brains seem to think that the answer is more windows. It’s hard to explain how incredibly short-sighted this is, because it’s so monumentally backwards that it makes you wonder what they’re thinking. At best, my guess is that the execs are extrapolating out in the simplest form that with the launch of each “window” they make more money, so the way to make even more money must be to offer more windows. Of course, this assumes two rather basic things that are totally wrong. One, is that these windows won’t piss off users and two, that those users have no alternatives.

But, apparently not realizing that, these execs have hit upon a few different attempts to add more windows. First, they’ve been pushing for the permission to break your TV or DVR with selectable output control barring your ability to tape movies. This way, they can create a new “window” of movies on TV that you can’t record, that they can offer before the movies even get out on video. Of course, this will (a) piss people off and (b) drive them to more piracy. Brilliant.

The other attempt, is to get video rental places to stop renting movies when the DVDs first come out. The LA Times had an entire article explaining this plan, whereby the studios would force all rental services, including Netflix and Blockbuster to not rent certain films — but only offer them for sale. The idea (short-sighted as it is), is that this would somehow force people to buy more DVDs, which gives the studios a higher margin than rentals. We actually heard about this earlier this year with the contract terms that the studios tried to put on Redbox, but it’s apparently trying to do the same with Netflix and Blockbuster as well.

This idea is so bad that even the LA Times, who tends to support its hometown industry more often than go against it, put out a separate opinion piece with the original article, calling this new idea “crazy” and “absurd.”

In the meantime, what do customers actually want? Well, there’s pretty good evidence they prefer choice not being limited by windows. They’ve been clamoring for so-called “day-and-date” release, whereby all these windows are compressed. If you don’t want to see a movie in the theater, why not be able to get the DVD? It’s as if the studios don’t realize that part of what they’re selling is the social experience of “going out” to the theater. Even better, if the DVD comes out at the same time as the theater version of the film, less marketing money needs to be spent to sell more DVDs, and you can do nice tie-ins, like having the ability to buy the DVD as you walk out of the theater. Giving people more value and more choice is what the market is asking for.

Instead, Hollywood execs are trying to take away choice and limit value. Incredible.

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Comments on “Dear Hollywood: Don't Be Idiots; Don't Delay Movie Rentals”

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TheStupidOne says:

I will pay once

If I decide that a movie is worth watching then I will pay (at most) once to see that movie unless it is truly spectacular in which case I’ll have seen it in the theater and buy a disk. No new windows will encourage me to spend more money. I will not get another tv channel just to see new movies pre dvd release.

I have a suggestion to the movie companies. Make your customers as happy as possible as often as possible. They’ll spend more money on you. I promise

TheAbsentMindedOne says:

Theaters just aren't worth it.

I prefer to watch movies at home. The popcorn is better, the seating is better, and I have a pause button.

About the only think that Movie Theaters have going for them (ignoring IMAX) is the massive sound system.

So this whole windowing thing for me just boils down to the movie industry shooting itself in the foot. Movies that I was really excited to see when they were new, I have forgotten about completely by the time they are released on DVD.

Nick (profile) says:

Re: Theaters just aren't worth it.

“Movies that I was really excited to see when they were new, I have forgotten about completely by the time they are released on DVD.”

Agreed. And on the rare occasion that I am so bored as to peruse my pay-per-view menu, I will sometimes remember that I thought I would enjoy seeing a particular movie, only to realize that I don’t care enough to pay 4.99 to see a movie I can’t save on DVR.

So essentially I don’t see it in the theater, don’t buy or rent the DVD, don’t watch on PPV, and thus don’t recommend it to others because I haven’t seen it.

sehlat (profile) says:

There's a *reason* for the studios' attitudes toward theaters

And it comes down to a long-ago case that went all the way to the Supreme Court: United_States_v._Paramount_Pictures,_Inc., which ended the studios’ ownership of theaters.

The theaters went from being studio properties, with all the incentives this gave the studios to make going to the theater a pleasant, enjoyable experience, to making the theaters just another customer. (And we all know how warmly and generously the studios treat their customers.)

So of course, now that everybody’s a customer, the studios are looking for new ways to sink pumps into everybody’s wallet.

DocMenach (profile) says:

A good example of why windows don't work

Many movies come out that I would like to watch, but for one reason or another the logistics of going to the theater to see them do not work out. Plus there is the fact that the theater does not really offer an experience I enjoy: I like to drink a beer while I watch a movie (in the US it is extremely rare for movie theaters to serve alcohol); I like to be able to pause the movie if I want to use the restroom or have a cigarette; For some movies it is nice to be able to pause the movie to discuss the plotline, or to rewind a part if you miss a piece of dialogue or want to re-watch an exiting part.

Now, if the option were available I would pay for a digital download, or rent or buy the DVD while the movie is still fresh. But since that is not currently an option I often don’t watch the movie at all, because by the time it comes out on home formats I have lost interest in it.

To me this is a very good example of a “lost sale”. This is not a lost sale due to piracy of any sort, but a lost sale due to the structure of the release windows.

Chronno S. Trigger (profile) says:

Windows between windows

I can almost understand why the movie studios are afraid of releasing the DVD at the same time that it’s in theaters, but why is there a 6 month window between when the movie is out of theaters and onto DVD? Would it not make much more sense (AKA: Money) to let the hype from the theater spill over into the DVD sales instead of letting it fizzle out in between?

ReVeLaTeD says:

Re: Windows between windows

Red Cliff was released digitally on 360 and other digital distribution outlets before releasing in theaters. The price was rather steep – about the price of buying the DVD for what amounted to a rental, basically – but I had the points available, and I was interested, so I got it. I hate going to the theater, because they seem to not want to upgrade to the latest in projection technology, so that blur is always there and it’s hard to focus with rude people around, babies crying, etc.

Star Trek Blu-ray just now came out, that movie was in theaters…what…almost a year ago now? And I bought it, but it just sits there. I’d like to see them distribute the Blu-ray in the theater the same day the movie is showing, then have it up for sale in stores within a month from the last theater showtime. As you say, while the movie is still fresh.

Designerfx (profile) says:

here, lost sale example

here’s what would have happened with less windows

day of release: download and purchase an mp4/1080p quality copy of where the wild things are.

count that as $20 to the movie company.

here’s what has happened due to the industry being asinine:
another year of 0$ to the theatres from me.

I’m tired of remakes, I’m tired of unoriginal content.

PRMan (profile) says:

They already broke my DVR...

It used to be that PPV movies on DirecTV hung around forever on your DVR. I still have FF2 on my DVR that I rented for my daughter’s birthday party once (they actually liked it).

Anyway, now PPV purchases expire after 24 hours. What if we are tired and want to continue the movie tomorrow? What if the kids suddenly remember that they forgot their homework?

How many movies do you think I have bought since the switch? That’s right, a big fat 0.

I never bought THAT many before (about 2 per year), but now I buy ZERO, because the convenience is gone. The last party we got really cheap tickets and went to an LA Kings game instead (they loved it).

So, movie industry, go ahead and make inconvenient windows to your hearts’ content. I don’t NEED any movie. If movies aren’t convenient, we’ll play (or go to) a game instead.

Joe (profile) says:

Why not offer the choices?

It would make sense to offer the consumers the option of how they want to view the content, especially now with all the newer ways one can go about viewing a movie. Maybe I want a DVD, maybe I want a digital download (PC or potable device viewing), maybe I want to stream it on my PC (same idea as a rental but streaming), maybe I want to go to the theatre with my wife for a date night.

Why not offer those options rather than clustering it into windows which does nothing except delay gratification in hopes that consumers purchase the movie on more than one window (which I probably still would).

Ron Rezendes (profile) says:

Considering the price...

For the price it costs to see a movie (ticket alone – don’t get me started on the concession stand) these days they should give you the DVD when you leave the theater! The entertainment industry has historically taken advantage of consumers, despite new technology making the actual media less expensive. Remember when cassettes disappeared because CDs hold so much more content and cost less to produce? What was the result of that technological advance? Higher prices for the same album! The music industry and the movie industry still believe it’s the 1980’s and people will just hand them money if the content is packaged in bright shiny colors.

I take my kids to the drive in occasionally where we get to see 2 first run movies for $6/person – we bring our own food and usually arrive early to have dinner. Unfortunately not everyone has this option.

Mike Masnick (profile) says:


Mike, you use windowing yourself. Is that not what the Techdirt Crystal Ball is all about? If one window is good why exactly is it that more windows is not better? If windowing works for Techdirt then why not for movies?

We don’t use windowing. Windowing implies taking the same offering and repackaging it for different media and trying to get people to pay multiple times.

The crystal ball let’s some people — who want it — get a brief insider’s view of the process by which we work on stories. But it does not hold back content from anyone.

Anonymous Coward says:

Re: Re: RTB

Hmm, dubious distinction. Windowing by itself has nothing to do repackaging, it has to do with releasing the same content (regardless of format) to different folks at different times. You do not charge for content but you allow a preview of it for those willing to pay. From your site:
“with the Techdirt Crystal ball, we give you a chance to see the headlines of some of the posts we’re working on, and some indication of when they might get published. And, once a story is published, you’ll be able to see it up to 60 minutes before anyone else can.”

The Techdirt Crystal Ball is exactly a release window, a pre-release window for those willing to pay. Just because you release the content in the same format later for free does not suddenly change the fact that you have a release window. Same window concept, different window dressing. If windows work for Techdirt then they can work for other businesses too.

DocMenach (profile) says:

Re: Re: Re: RTB

Just because you release the content in the same format later for free does not suddenly change the fact that you have a release window.

You have once again shown your ability to not pay attention. So I will re-quote Mike’s response regarding that: “The crystal ball let’s some people — who want it — get a brief insider’s view of the process by which we work on stories.”

Do you get it now? It’s not the content in the same format at all. It’s more like getting to watch a movie in the process of being made.

Anonymous Coward says:

Re: Re: Re:2 RTB

Fair enough, the Crystal Ball has the extra feature of pre-release material/process of being made material. But there is still a 60 minute window, after the content is published and before the content is released to the public, where Crystal Ball holders can view the content. The extra feature does not make it any less of a window. Its still a window. Get it now?

DocMenach (profile) says:

Re: Re: Re:3 RTB

The issue of weather Techdirt’s Crystal Ball offering constitutes a release window is really irrelevant to this issue anyway. Even if you call the Crystal Ball offering a release window, the structure is drastically different from the movie industry’s release window system.

The issue is that the structure that the movie industry has chosen for their release windows is not a very sound business tactic. Based on the comments above it appears that the release window structure that the Movie industry has chosen has cost them many sales. So their solution is more release windows? I really don’t see the logic in that.

Anonymous Coward says:

Re: Re: Re:5 RTB

It’s standard techdirt “do as I say” work at it’s finest.

Windowing is windowing, no matter how you do it. It just doesn’t matter with this website because, well, Mike is special.

Seriously, I can’t imagine anyone standing up for this, it’s clear that Techdirt windows it’s content, and specifically sold it’s membership / cwf / whatever based on it.

DocMenach (profile) says:

Re: Re: Re:6 RTB

…and they did a good job of finding a system that works well and gives people a reason to pay. People that choose not to pay still get full access to the content. It’s a drastically different model from the approach the movie industry has been doing.

The point is that the movie industries current windowing model is showing it’s weaknesses, and it appears that one of the proposed solutions is to create further windowing. This does not seem to make very much business sense. One of the key reasons for this is that it causes marketing funds to be less efficient: A typical Hollywood film’s budget is composed of more than 1/3 marketing (source). Much of this marketing budget is used to create excitement for the film in preparation for it’s release in theaters. For many people, the marketing works and gets them interested in the film, but they are unable to see the movie in the theater for various reasons. With numerous entertainment choices vying for peoples attention, today’s hot movie becomes yesterdays old news very quickly. By the time the movie is available for home viewing the excitement has worn off, and many people who would have bought a DVD, paid for a Download, or Paid for a rental during the initial marketing blitz are no longer interested. Based on that, it does not appear that increased windowing is a very good solution.

You can say “windowing is windowing” all you want, but that doesn’t offer a solution to the movie industry’s problem. The comparison you make to Techdirt’s Crystal Ball is irrelevant to the discussion of what the Movie industry should do to solve their business model problems.

Anonymous Coward says:

Re: Re: Re:7 RTB

Mike is talking about “whereby all these windows are compressed” while at the same time offering a window himself. In that case perhaps the windowing is not the problem but the way in which the window is used. Rather than throwing windowing out I attempted to draw out differences between Mike’s window and other windows – maybe there is a way that windows can work for movies. I do not have all of the answers but I’m willing to discuss it. Mike apparently is not willing to discuss his window.

You can say that I am off topic all you want but you are ignoring possible solutions.

It is easy to compare the ‘insider’ content of the crystal ball vs. the free edition of techdirt to the theater experience vs. the dvd experience. One thing that is interesting about Mike’s window is that it is short, 60 minutes or less. Perhaps the movie industry just needs to shorten the time between windows or work to make all windows the same world wide or both. Since Mike has his own window you’d think that he’d offer some insight into windows. Instead his advice is to compress all windows. Why then would he continue to offer his own window?

R. Miles (profile) says:

Re: Re: Re: RTB

If windows work for Techdirt then they can work for other businesses too.
Really? Let’s see how you feel if Techdirt offers its content 6 months after it screens originally to those who viewed the first window.

Be rather pointless, wouldn’t it, to discuss a story 6 months after it passed?

I do agree with your assessment that the CB is a window, but its purpose is to allow those who want a sneak peek to get a jump on the news.

If this were an equivalent to the movie industry window, it would be a preview party, where many theaters show a movie at midnight the day before it’s officially released.

But in the context of the article, Mike’s remarks are spot on. There should be *absolutely no reason* why I can’t buy the DVD as I’m walking out of the theater on my way home to watch it on demand.

When you can come up with a reason why this asinine approach is taken, fill us in.

Anonymous Coward says:

Re: Re: Re:2 RTB

Again, I never said I supported the windows the movie industry currently uses them. Just wanted to open the discussion to the differences between windows that work and windows that do not work. As I noted in my post last night, Mike’s windows has an interesting difference in that his window is up to 60 minutes but not more. Perhaps shorter windows could work for movies too. The short interval, 60 minutes, has a nice feature that it essentially thwarts piracy and that is a good thing. Mike has an examnple of a window that works (or at least works better). How can that be applied to movies?

Thank you for being the only person willing to debate the subject.

Mikecancook (profile) says:

For what it's worth...

I have a decent collection of about 500 movies. I used to just buy new releases without ever actually seeing the movie until I realized that many of these movies were only really good for one viewing, if that.
But now, my decision to buy a movie really comes down to if it has replay value otherwise I’d just rent it, watch it and turn it in.
As for going to the theater to watch a movie, it depends on if it’s a movie that has some advantage to seeing in the theater and if that advantage outweighs the negatives of actually going to the theater. Such as the drunk guy yelling at the bad guys on the screen, the people who think its ok to answer their cell phones and talk, general public idiocy and rudeness, etc.
After all, I have a nice home theater, great surround and nice comfy couches. I can stay in and not have a great time.

The Buzz Saw (profile) says:

What? They don't want my money?

Have they done any research on this? Preventing rentals, for many movies, reduces my chance of seeing them from around 25% to 0%. People don’t buy movies because “they have no other choice”.

Hollywood has this fantasy perception of people. People are apparently so desperate to see these movies, they will do whatever it takes. Well, I have a news flash for the movie industry: there is more to life than cinema. It is a beautiful art form, but the world would not suddenly end if we were unable to get our hands on Star Trek next month.

Dave (profile) says:

Re: Keep dreaming

According to IMDB, the last two Transformers movies grossed a combined $721M at the box office. That’s *before* DVD sales, PPV and rentals, which is the other 75% of movie revenue.

It’s going to be a VERY long time before Hollywood’s business model implodes. Because America likes ’em big and stupid, and they’ll put up with the BS to get what Hollywood spoon-feeds them.

tracker1 (profile) says:

Multiple windows are ignorant.

I personally agree, that a DVD release with the live movie might be a great idea, and marketing, which is one of the biggest costs in movies could be cut dramatically for simultaneous DVD and Theater release. Hell, have the DVD only available at the theater for 4 weeks. Then you get two sales from those that want it sooner.

Personally, I look at a movie preview and it goes into a few options. 1) I really want to see this on opening weekend. 2) my wife wants to see it. 3) It’s got lots of special effects and might be good. If it’s one of those three, I see it in the theater. Otherwise, odds are I’ll wait for video, if I remember about it when the DVD comes out. Since I don’t watch much TV, that doesn’t always work so well.

Anonymous Coward says:

I have never understood why Hollywood doesn’t just open it’s own DVD store inside the lobby of each multiplex (unless it’s due to the legal thing forcing studios to divest from theater ownership.) If so, leasing the space would still be legal, right?

It’s the perfect impulse buy… You come out of a movie with your friends, family, kids, and or date all pumped up, and someone’s gonna say “That was great, I have to have that on DVD!” Not 6 to 8 weeks later, when they’ve kinda forgotten about it, but right then!

That way, Studios get the full retail markup (split with the theater or whatever, but that’s just negotiating the deal) instead of selling them in bulk to Walmart at wholesale. Duhh…

But noooOOOOOooohhh….

Daemon_ZOGG (profile) says:

"There Is No Spoon."

Entertainment industry executives have no reasoning skills. They are still trying to build on an extinct business model. Technology has left them as road-kill on the side of the road.
Theaters suck. Over half of the people in them, have no sense of respect for others around them. The food $ucks, and don’t even think about where those seats have been. With the latest Mobile devices.. Theaters are outdated. RedBox is ok if the DVD isn’t scratched too badly.

It’s actually more exciting to see what DVD quality movies the pirates are releasing on any given day. At least with that, people are not screwed out of their money several times over for the same movie title. Change is here. It’s already happened.

Roadkill – One that has failed or been defeated and is no longer worthy of consideration.

Movie Industry Business Strategy – *see “Roadkill”

Steve says:

Yeah, 200 inch screen, LCD projector, 1500 watts of THX sound, home theatre seating, no sticky floor, no cell phones, no laser pointers, no mouthy kids, no seat kicking, FRESH popcorn that doesn’t cost $8.00, beer, weed, and my feet up. Sorry there’s no compelling reason for me to have “the theatre experience.” I’ll gladly pay to watch a movie at home on opening day but I haven’t been in a movie theatre in over 2 years so where does the studio benefit exactly? Sure there’s 5 of us watching the movie for the price of a single admission but that’s 5 people that weren’t going to the theatre anyway soooo zero dollars is much better than say $10 or $12? That’s a funny way of doing business and then sit around and wonder why you’re losing money.

Anonymous Coward says:

The reason that they’ll never release a DVD the same day as the theater release is that they are terrified that the piracy boogie man will take over after opening weekend. They tend to imagine money that was never there in the first place and THOSE are the “lost” dollars that they want. They can’t see the forest for the trees and it’s killing them. They’re being taught but refuse to learn a lesson that’s a cornerstone of basic business knowledge. You don’t decide what your product should ultimately be, the market does. The sooner they deliver what the market wants, the sooner the market will reward them. Try to bend the market to your will and it will crush you without breaking a sweat and find what it wants anyway bypassing you completely.

Yeebok (profile) says:

Interesting viewpoints

Anonymous Coward, arguing with yourself is pointless. For the record, from my perspective if you can’t be bothered to type a name, it devalues whatever you say by about 90%.

Techdirt has, when viewed under a very narrow definition, a window. I don’t subscribe to it, in fact I get what I need from the site without having to pay for it, but others can get a little more information a little earlier if they pay. So ? I am sure the movie company will give you their movie for free 24 hours later. Err .. or not. If you’re a techdirt regular you’ll know the main premise of the post is to note how stupidly the movie industry is behaving from a *business model* sense. Mike may ‘rant and rave’ but the fact of the matter is, he has a point. He’s offered a few suggestions and raised a few points, whereas the naysayers are only managing to type “you have a window too” which is the debating equivalent of a four year old’s retort of “I know you are, but what am I?”

Simply put, the last movie I paid to see at the cinema was .. err .. jeez .. anyway it’d be Shrek2, I think. The last time I rented a movie was last week, the time before that .. err .. 6 months maybe. To me movies aren’t that valuable at all. 90% of them it wouldn’t worry me if I missed them. There’s the odd exception, sure.

Overall, I’m like most other commenters – by the time it comes out on DVD, I’ve pretty much forgotten about it, so generally I don’t buy any. Those that I have bought are backed up onto my PC anyway, so I can watch them without ruining that stupid, ridiculous physical object the industry is obsessed with (I bet it’s because they’re shiny).

The cinemas bug me – I’m not agoraphobic, but I’m most comfy at home, like most people. I’m not inclined to pay and go watched forced advertising while being squeezed in with noisy teenagers and smelly old people and then have the “experience” ruined by some peanut with a mobile phone. Screw that! If I could pick up a DVD of an at-the-cinemas movie at the supermarket or whatever same day it was released I might buy it, but if by the time the DVD is released most people know a fair chunk about it due to hype and word of mouth, why the hell would I pay full price for the least interesting half of a story ? A DVD in Australia is about $27, a movie ticket is usually $12ish (I live outside a major city), so why would I pay twice as much if I already know the good bits (they are shiny though..)?

The movie industry needs to realise that some people just want to be able to watch it at home, but by the time they can legally buy it and do so, the movie’s close to worthless to them. It would also mean the companies could get all their profit in one go if there were only one release window, and then they can go home and have a circle jerk about how much money they screwed the world for sooner.

$714mill from a movie, and expecting a further 2.2b (assuming that what was written above is what was meant) that’s just obscene.

Anonymous Coward says:

Re: Interesting viewpoints

You are a moron. Did it ever occur to you that maybe there is more than one AC? I’m not arguing with myself, I’m trying to engage readers like you in discussion – something other than ‘Yea, what Mike says, I want DVDs sooner too’ (which is what most of the comments say). I suspect that the movies industry is not just going to throw out its model and switch something else in. So why can’t we try to come up with some middle ground, a compromise?

The discussion of Mike’s window only got involved when Mike denied having a window. Otherwise the discussion was about what makes Mike’s window work and the movie industry window not work. I never said I supported the movie industry or that I believe in their model or that they should make any money. So pay attention, I’m on topic and trying to discuss a model where windows could work – it seems that probably means short windows, which is different than no windows.

I love how people that don’t just agree with Mike are told they are off topic. You drones have no opinion of you own.

The Infamous Joe (profile) says:

Re: Re: Interesting viewpoints

Did it ever occur to you that maybe there is more than one AC?

Yes. Did it occur to you that we don’t see your IP address (luckily for you) and so we can’t tell the difference between one troll AC and another troll AC? So, if you *really* want to “engage readers”, take the extra 4.7 seconds and type in an identifier. Otherwise, you’re just a trolling anonymous coward.

John Fenderson (profile) says:

Re: Re: Re:2 Interesting viewpoints

Actually, not so much.

The name give continuity. If a commenter here has a record of making great comments, I’m much more prone to thinking more deeply about what new things they have to say than I am from a commenter who is unnecessarily confrontational, irrational, or just dumb.

What a person has to say is better understood when you know the context of the person saying it.

So, if someone is really here to engage in real debate, they are highly advised to have an identity. Register, even, so it’s easier to look at their past comments and get an idea of where the person is coming from. It will help people understand their arguments more clearly which, theoretically, is what they want.

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