Digital Nerd

Tuesday, October 11, 2005

Cuban to Launch DVD Label?

Via Wired:

Via Wired:

Mark Cuban is hiring staff that could form the nucleus of a new DVD label, Wired News has learned, a move that comes as the dot-com billionaire attempts to shatter Hollywood's release window system by making first-run films available simultaneously in theaters, on cable TV, online and on DVD.

The label is expected to launch in January with the release of Bubble, the first in a six-part deal between Cuban's 2929 Entertainment and director Stephen Soderbergh, according to a source familiar with the plan. As yet, Cuban and partner Todd Wagner have not announced a DVD publisher for those pictures.

Find local technology jobs. In an interview, Wagner would neither confirm nor deny a pending launch. But he said 2929 will pay theatrical exhibitors 1 percent of revenues generated from DVD sales of films they offer in the same window at their theaters.

By launching a DVD imprint of their own, Cuban and Wagner would round out a set of assets that covers most but not all of the bases in film distribution. The pair owns holdings that include Landmark Theaters, HDNet Films, the HDNet Movies channel, Rysher Entertainment, Magnolia Films Distribution, 2929 Entertainment and a piece of Lions Gate Films. Online, they have a deal to offer HDNet Films titles on Cinemanow.

According to an online job posting, Magnolia Pictures is hiring a DVD accountant whose responsibilities include monitoring inventory levels, working with DVD replicators "to ensure sufficient supplies are available for replenishment," and setting up electronic data interchanges, or EDIs, with vendors and customers. An EDI is a secure electronic transaction and auditing channel between suppliers and vendors, without which it is nearly impossible to do business with big box retailers.

The only film known to have debuted on TV, DVD and in theaters the same day so far is Noel, a holiday movie starring Susan Sarandon, Penelope Cruz and Robin Williams in an uncredited role. The film was released last November on cable's TNT, in a handful of theaters and on disc the same day. But the disc was a Flexplay disc that expired in 48 hours, and it was only available on Amazon.com. Neither side will comment but sales were reportedly low, some in the industry say a mere 1,500 copies. The title eventually found distribution under the Screen Media imprint. Screen Media has a distribution deal with Universal Studios Home Entertainment that will put the title in stores on standard DVD for the first time Oct. 25.

Soderbergh's murder mystery Bubble is the first 2929 film slated for release across all channels.

Some news outlets have erroneously reported that Magnolia's Enron: The Smartest Guys in the Room was released simultaneously on TV, DVD and in theaters. In fact, the film has yet to be released on DVD.

Hollywood has shunned simultaneous releases, preferring to milk as much cash from each "release window," as the time blocs are known in the industry, before it moves to the next. The traditional model has movies hopping like tiddlywinks from theaters to home video/DVD, pay-per-view, premium cable, broadcast cable and then broadcast television.

But as box office proceeds fell and DVD sales began to level off over the summer, even Robert Iger, who has since taken the reins as CEO of The Walt Disney Co., suggested that the theatrical "window" should be snapped shut and DVDs released at the same time.

"We can't stand in the way and can't allow tradition to stand in the way of where the consumer can go or wants to go," Iger told analysts. "Windows in general need to change. I don't think it's out of the question that DVDs could be released in the same window as the theatrical release. All the old rules should be called into question because the rules of consumption have changed so dramatically."

Exhibitors have cried foul, saying, among other things, that DVDs only sell because theatrical exhibition heightens their profile.

"Mr. Iger knows better than to tell consumers -- or Wall Street analysts -- that they can have it all, everywhere, at the same time," said John Fithian, president of the National Association of Theater Owners. "He knows there would be no viable movie theater industry in that new world -- at least not a theater industry devoted to the products of Hollywood. And he should know that Hollywood studios would be just one shriveled vendor among many in that world of movies as commodities only."

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