Disney on Premium VOD: ‘Nothing Substantial Has Come of It’

Despite attempts by Disney to explore the premium VOD window — which offers up home video versions of movies closer to their theatrical release — “nothing substantial has come of it,” the studio said.

That should give theater owners a little bit of relief as exhibitors worried that earlier than usual VOD releases would leave them with empty seats. They might have a few more years to remain calm, outside of the continued experimentation by independent filmmakers and smaller distributors.

“I don’t see any substantial changes (in premium VOD growing from the major studios) in the next few years,” said Walt Disney Studios president Alan Bergman on Wednesday at the Bank of America Merrill Lynch 2014 Media, Communications & Entertainment conference.

Instead, Disney is focused on digital ownership through the electronic sell-through window, which generally makes films available through digital retailers three to four weeks before disc releases.

“We’re trying to jumpstart electronic purchases and it’s been effective,” Bergman said. “It will be something we will continue to do.”

That’s especially true as consumers shift away from building large physical DVD and Blu-ray libraries at home, with disc sales off around 8% to 10% each year, Bergman said. On the flipside, digital sales are up 37%.

“Clearly the physical business has had a difficult five or six years and continues to decline,” said Bergman, although he stressed “it’s still a very significant business,” that’s expected to generate $8 billion in 2014. “We have titles people want to buy on physical but digital is the future and that’s why we put resources behind movies on demand. In the longterm, we want people to buy our movies on digital platforms.”

SEE ALSO: Premium VOD War Is Back: Disney, Sony Early Releases Sure to Enrage U.S. Exhibitors

To encourage more digital sales of its titles, Disney launched the Disney Movies Anywhere service in February that enables users to watch Disney, Pixar and Marvel movies online and on the go, while providing them exclusive extras and rewards.

The service’s app has been downloaded over 4.5 million times so far, Bergman said.

The goal is to now expand Disney Movies Anywhere to make it accessible on more devices and function with more retailers, not just Apple’s iTunes store.

“The goal is interoperability,” Bergman said, to let consumers “buy a movie where they want and watch it where they want.” He did not specifically mention new kinds of deals Disney would make, nor UltraViolet, the digital storage locker most studios, retailers and electronics makers have backed to boost digital purchases.

SEE ALSO: Will ‘Veronica Mars’ VOD Release Kickstart New Trend in Hollywood?

With a strong slate of tentpole films coming from the studio in 2015 and 2016, and “Frozen” and Marvel Studios releases performing strongly at the box office, Bergman naturally pushed the moviegoing experience at the multiplex.

“We want these movies to be seen in theaters,” he said. “They’re the best place to see these movies.”

But “theater owners need to make sure that the experience is great,” he stressed, referring to the quality of seating, sound and picture. “If we both hold up our bargain, we’ll be in good shape.”

More Biz

  • Frontrunners Emerge As BBC's Tony Hall

    Frontrunners Emerge as BBC Boss Tony Hall Set to Leave Broadcasting Behind

    As the U.K. industry reacts to news of Tony Hall’s intention to depart the BBC this July, top-level executives including Charlotte Moore and Tim Davie as well as external contenders such as Channel 4’s Alex Mahon are beginning to emerge. Variety understands that Lord Hall, who has headed the BBC for seven years as director [...]

  • Recording Academy President/CEO Deborah Dugan participates

    Executive Assistant Preparing Lawsuit Against Ousted Grammy Chief

    In the latest twist in the increasingly bitter exit of Deborah Dugan from the Recording Academy after just five months, the ousted president/CEO is about to face a lawsuit from her former assistant, Claudine Little, who has retained former Harvey Weinstein/ Charlie Walk attorney Patty Glaser to represent her, two sources tell Variety. The news was [...]

  • Two Rivers Media Buys Out Parent

    Two Rivers Media Buys Out Parent Kew Media Group's Stake In Business

    Two Rivers Media has bought out parent group Kew Media Group’s minority stake in the business. Formed by former STV Productions head Alan Clements in January 2019, the production outfit behind Channel 5’s recent “Susan Hill’s Ghost Story” launched with the backing of Kew, Noble Grossart Investments and Channel 4’s Indie Growth Fund. Noble Grossart [...]

  • Grammy Awards 60th Annual Grammy Awards,

    Recording Academy Paid Millions Annually to Outside Law Firms

    Among the concerns listed in a memo sent to the Recording Academy’s head of HR by president/CEO Deborah Dugan before she was placed on administrative leave Thursday was an item about the organization’s “exorbitant and unnecessary” legal fees to outside law firms, according to sources familiar with the document. According to the most recent 990 [...]

  • Chuck D of Public EnemyGods of

    Public Enemy’s Chuck D Slams Grammys Over Deborah Dugan Ouster

    Chuck D, frontman of Public Enemy — who are receiving the Lifetime Achievement Awards at the Grammys next week — posted a long statement on Instagram criticizing the Recording Academy over its sudden ousting of new president/CEO Deborah Dugan yesterday. Dugan, who had been in the job only five months, was placed on administrative leave after [...]

  • Any Given Wednesday With Bill Simmons

    Spotify in Talks to Acquire Bill Simmons' The Ringer: Report

    Spotify is in early talks to acquire The Ringer, the digital content and podcast network launched by ESPN alum Bill Simmons in 2016, according to a report in the Wall Street Journal. A representative for Spotify declined to comment on the report. Reps for Ringer did not immediately respond to a request for comment. Spotify’s [...]

  • Deborah Dugan arrives for the 20th

    Deborah Dugan's Recording Academy Ouster Follows Multiple Tussles With Board

    “Change is afoot,” Deborah Dugan said more than once during interviews with Variety in the weeks before her shocking removal from her post as president/CEO of the Recording Academy after just five months on the job. During those conversations, Dugan spoke of changes she planned to make in the Academy’s staffing organization, its Board of [...]

More From Our Brands

Access exclusive content