The illegal theft of movies taped off pay-per-view broadcasts is costing the major studios $ 67 million annually in lost homevideo revenues, according to a soon-to-be released study commissioned by the Video Software Dealers Assn.
The release of the study has pitted proponents of PPV against the retail membership of the VSDA, with execs from PPV firms Request Television and Viewers Choice claiming the survey is flawed and riddled with inaccuracies.
But several studio sources support the conclusions in the survey and find the data credible.
The goal of the study is to get major studios to increase the pay-per-view window — the length of time cable channels can offer a first-run movie to subscribers before it’s available on video — from the current 30 days to a minimum of 80. But so far, only Paramount Home Video and Columbia TriStar have acted, extending the window to 80 days in most cases. Other studios are considering a similar move, but have remained on the sidelines.
The VSDA survey — completed by industry research firm Cambridge Associates — also claims that when PPV subscribers are able to tape a first-run movie off the air, it significantly diminishes homevideo rental and sell-through revenues of the same title.
The charge is roundly disputed by PPV executives, who assert the theft problem addressed in the report is exaggerated. VSDA spokesman Bob Finlayson doubts the studios’ decision to go to an 80-day window was based solely on the survey, saying the move makes solid business sense.
“The fact that (the studios) would make more money by extending the window is probably what motivated them,” Finlayson said.
Analysts note that films on homevideo generate just north of $ 4 billion annually for the studios, while pay-per-view is responsible for around $ 70 million.
“The Paramount case proved that if studios extend the window, retailers respond by buying more product,” Finlayson noted.