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Holiday grab bag

Screeners go bye-bye, but Q4 has plenty of other disc thrills

Despite a fourth-quarter roster that includes a rash of summer theatrical disappointments, DVD is expected to once again smash sales records as more consumers adopt the format, while those who already have continue to buy discs at a record pace.

With DVD penetration at nearly 50 million households, 15 million more than a year ago, sales during the Christmas quarter are expected to increase as much as 50%, according to Warner Home Video estimates. All of the major studios’ homevid divisions will be spending record amounts on advertising and media events centered around the biggest releases to entice consumers.

As usual, releases on DVD of summer tentpoles should lead the way.

Following a long line of animated hits that have done well on homevid, Disney/Pixar’s “Finding Nemo” (out Nov. 4) is expected to easily net the top DVD sales position for the quarter — and, perhaps, all time.

Altogether, there are 15 summer movies that grossed more than $100 million in domestic B.O. this summer at the box office due out on DVD in the fourth. Among them, Top sellers should include Disney’s “Pirates of the Caribbean: Curse of the Black Pearl,” Warner’s “Matrix Reloaded” and “Terminator 3: Rise of the Machines,” Fox’s “X-Men 2: X-Men United,” Sony’s “Bad Boys 2” and Paramount’s “The Italian Job.” in October.

Meanwhile, based on the strength of summer titles “2 Fast 2 Furious,” “The Hulk,” “Bruce Almighty,” “Seabiscuit” and “American Wedding,” Universal Studios Home Video expects to surpass its record-breaking 2001 fourth quarter, when it grossed $1 billion.

This year’s release slate will be bolstered by a powerful group of franchises hitting DVD for the first time. Disney’s “The Lion King” — which reigns as the top video seller of all time with sales of 31 million VHS units since 1995 — roars onto DVD in October backed by a $150 million marketing campaign.

“The Lion King” is just one of a handful of venerable film franchises coming to DVD for the first time in Q4.

In October, Paramount Home Entertainment debuts will release the “Indiana Jones Trilogy” on DVD for the first time. Both venerable franchises are expected to reach new release heights of millions in unit sales on DVD.

Also due out in Q4 is the long-awaited “The Adventures of Indiana Jones: The Complete Movie Collection” from Paramount Home Entertainment, a special edition of “Scarface” from Universal, a nine-disc “Alien Quadrilogy” set from Fox Home Entertainment and New Line’s “The Lord of the Rings: The Two Towers Extended Edition” (distributed by Warner Home Video).

Other catalog titles getting special-edition treatments in Q4 include “Chitty Chitty Bang Bang” from MGM, “JFK” from Warner, and Artisan’s “Dirty Dancing” and “On Golden Pond.”

, Each of these venerable franchises is expected to sell millions on DVD

, “Chitty Chitty Bang Bang” from MGM and “Dirty Dancing” from Artisan Home Entertainment

And then there’s the fast-emerging TV-on-DVD category.Just about every studio and independent company is releasing a set from TV DVD dominator Notable fourth-quarter releases product launches will include Warner’s “The West Wing: The Complete First Season,” HBO’s “The Sopranos: The Complete Fourth Season” and “Sex and the City: The Complete Fifth Season,” Fox’s “X-Files: The Complete Eighth Season,” Miramax/Buena Vista’s “The Osbournes: The Second Season” the DreamWorks miniseries “Steven Spielberg Presents Taken,” and Lions Gate’s “Anna Nicole Smith Show,”

As with any holiday season, family/children’s movies are also expected to do well. That could offer a second chance to DreamWorks’ “Sinbad: Legend of the Seven Seas,” which lost its way at theaters. There’s also a crush of made-for-DVD CGI-animated movies, including Artisan’s slate of “Barbie of Swan Lake,” “Hot Wheels” and “Rescue Heroes,” Miramax’s “Bionicle: Mask of Light”; Universal’s “The Land Before Time X: The Great Longneck Migration,” and Warner’s “Batman: Mysteries of the Batwoman.”

Meanwhile, suppliers expect solid homevid performance from the summer’s sleeper hits. Columbia will release “Whale Rider,” “Nowhere in Africa,” “The Secret Lives of Dentists” and “Spellbound.” Fox will launchis hoping for the same with releases of “28 Days Later” and “Bend It Like Beckham.” And DreamWorks will enter the anime arena with “Millennium Actress.”

“One of the great things about DVD is there’s been an evolution at retail over the past five years, which has allowed us to reach niche audiences,” says Columbia TriStar Home Entertainment president Ben Feingold. “Five years ago, we didn’t have Amazon, we didn’t have Netflix.”

Lions Gate’s “Anna Nicole Smith Show,” Paramount’s “Honeymooners” and the list goes on.And on.

With summer box office admissions down from 2002, and a number of underperforming films due out on DVD in the quarter, some analysts — and at least one major rental chain — have speculated that consumers will curb their rabid DVD buying, and choose to rent instead.

“Does some of the theatrical disappointment of the year make for a better rental season? I don’t know, it’s hard to say,” says Disney homevid prexy Bob Chapek. “As soon as people get those new machines in the household, they want to buy DVDs for them.”

Indeed, the studios have made their holiday merry the past few years selling discs to consumers who’ve just bought DVD players — and 5 million more U.S. households are expected to purchase the devices that play DVDs this year. Consumers continue to buy an average of 15 DVDs a year, far more than they ever bought on VHS.

Not only that, the number of catalog DVD titles they are buying is inching up, according to Warner execs.

Meanwhile, there are those who suggest that the summer’s theatrical underachievers will overachieve in the DVD sales area in Q4. While video performance of a movie has long helped salvage theatrical disappointment, the difference between a movie’s performance at theaters and performance on video the two is becoming even more disparate, particularly on midrange box office titles, which are producing way more on video these days.

“On a title-by-title basis, we’re seeing in research that consumers are choosing to wait,” says Alex Carloss, VP of marketing for MGM, which will release “Legally Blonde 2: Red, White and Blonde” on DVD in November. “There’s an increasing lack of correlation between the box office of a title and its video performance, which spells opportunity for many titles that can’t quite find their audience theatrically.”

On average, 60% of DVD buyers have never seen the movie before buying it, according to Universal topper Craig Kornblau. “Why do 60% of people buy something they don’t see in theaters? It’s because we start with the film and create a much richer experience.”

That’s all good news for those films that didn’t quite perform as well as expected — “Charlie’s Angels: Full Throttle,” “Lara Croft Tomb Raider: Cradle of Life,” “The Hulk,” “The League of Extraordinary Gentlemen” — all of which may also benefit from are targeted toward DVD’s core buying demo of men, notes Fox Home Entertainment topper Mike Dunn. “Most of the summer titles are in the right genre for DVD.”

Retailers are devoting more space to DVD, and an increasing range of stores retailers are carrying the discs. DVD, creating new opportunities for different types of movies, though store shelves remain dominated by new releases. Gas stations and grocery stores , which tend to do well with sales of children’s and family movies in addition to new releases, are just some of the chains non-traditional retailers adding DVD. Selling in such non-traditional outlets has allowed homevid suppliers to reach demos they traditionally haven’t. traditionally been able to cater to.

“This fourth quarter is exciting in its incredible diversity and richness — all the new TV series coming to DVD and the great classics of the catalog,” notes Paramount Home Entertainment president Meagan Burrows.

But when all is said and done, even with more retail outlets and a bigger DVD market, it all comes down to a finite number: consumer dollars.

“It’s going to be a very competitive fourth quarter,” says DreamWorks Home Entertainment head Kelley Avery. “Over time, more movies have shifted to sell-through. More movies are competing for the same purchasing dollars.”

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