Powered by TMCnet
| More

Cable Technology Feature Article

November 04, 2010

Time Warner Set to Offer Premium On-Demand Movies

By Beecher Tuttle, TMCnet Contributor

With the steady decline of DVD sales and rentals, major Hollywood studios have been forced to consider modifying their routine of making movies available to consumers several months after they leave theaters.

Time Warner indicated on Wednesday that it will become the first major Hollywood studio to offer movies via video on-demand channels the minute they finish running in theaters.

"We're near agreement with our distributors on the right window and the right price point," Time Warner (News - Alert) CEO Jeff Bewkes told investors and analysts during a third quarter conference call.

While Bewkes did not mention how much consumers could expect to be charged for renting a fresh-out-of-the-theater movie, Variety is reporting that Time Warner will price the on-demand titles at anywhere from $30 to $50 for a short-term rental. The movies are expected to be available in high-definition and, in some cases, 3D.

Analysts expect that Time Warner will probably launch the concept this summer with one of its larger releases, such as The Hangover 2, Green Lantern or Sucker Punch.

As expected, the announcement by Bewkes did not go over all that well with theater owners, who have routinely taken issue with the concept of the early home video release, according to Variety.

"Exhibitors were surprised today to read Mr. Bewkes' comments," said John Fithian, president and chief executive of the National Association of Theater Owners. "They assume that Warner Bros. would discuss new models with their existing exhibition partners prior to finalizing radical agreements that could damage the entire movie industry."

It will be interesting to see if consumers are willing to pay such a premium price for the privilege of watching a movie just a few days after it leaves the theaters, especially considering that the expected price point is higher than the current cost of a Blu-ray DVD.

Beecher Tuttle is a TMCnet contributor. He has extensive experience writing and editing for print publications and online news websites. He has specialized in a variety of industries, including health care technology, politics and education. To read more of his articles, please visit his columnist page.

Edited by Stefanie Mosca