The central idea of this article, which is that slowing DVD sales due to the explosion of streaming options are slashing profit margins, is fascinating to me primarily due to the relative absence of blame-shifting onto 'piracy.' There was a mention of it, but it seems Hollywood has finally moved past the 'Piracy is causing all our woes, DMCADMCADMCA' delusions of the late 90s/early 2000s. As a Slashdotter from back in the day that saw such scolding played out on the front page I find it strange (yet optimistic) that they finally saw the real writing on the wall.
However, even though the central conceit of the article is interesting to me I find the language just goddamned terrible. I guess if you're looking for properly-flavored industry news then sentences like "[h]is first picture was the tentpole smash Rise of the Planet of the Apes, and he already had three television shows on the air" and "[m]ore recently, he released the smash Identity Thief, with Melissa McCarthy and Jason Bateman" are right up your alley. I'm suprised the author didn't describe some upcoming SMASH deal as BOFFO.
I agree but she interviews much better than she writes: http://www.salon.com/2013/06/14/hollywood_memoirist_lynda_ob...
It's funny that she was an editor for the New York Times. I'm guessing she decided to edit her own book, so she had no one to tell her that her breathless and gossipy over-wrought writing style would be laughable if it weren't so painful to read.
Even as an excerpted article, however, it needed to be edited much more. I skimmed the last half because I found the style unbearable. If you're going to explain why movies suck now, then start talking about facts, ideas, and their connections. Why bother with so much character development when those characters don't matter in such a short piece?
> New Abnormal producers like Peter were thriving, easily finding supersized tentpoles with the “preawareness” that was so craved by the New Abnormal
The only situation I can think of is that you bought or moved your DVDs from a different "region." And the number of people actually dealing with that is so small it's not even worth mentioning.
Perhaps you meant Blu-Ray? While issues are perhaps more common, they're not common enough to drive people away. BR's sales problems are due to high cost and poor timing to market.
I think this is a bigger deal than efforts to curtail piracy. If nothing else it's just more convenient to stream a video than to go to the store and buy/rent it.
In theory they could make up the difference by charging the streaming services enough to make up the difference, but I don't think the market supports a higher price.
First, we're dealing with people who are LOADED. Why should I care if they can't afford to pay Tom Cruise, the director, the producer, and a bunch of other people 20 million dollars each? Oh darn, they'll only get paid 4 million dollars each.
This is a classic case of old, technologically-inept white men whose business model was predicated on gouging the public for decades. The internet is killing DVD sales because of convenience and theatre revenues are down because the public is getting tired of superhero remakes and don't feel that the price of admission is worth 2 hours of watching 3 actors standing in front of a green screen and interacting with a bunch of CG extras, so they download it instead. All of a sudden Hollywood can't continue their price-gouging, and because they're basically Luddites, they fear change and can't adapt.
So they'll inevitably turn to the courts instead of letting their business adapt to the free market that they all espouse to love.
It's basically the situation that the American car companies found themselves in a few years ago. People are getting tired of their shitty products and aren't buying them any more. Instead of making better products that people would be willing to pay for, they curl up in the fetal position and cry.
These are the same guys who are hunting-and-pecking nowadays because they fear change.
Does not compute - why do they download it if they are tired watching it?
If you had read the article, you'd know that they make uninspired sequels because they are the only movies that make predictable profits.
Because it is worth it if it is free of charge. However, it is not paying up front for.
So take something like Battleships. Would I pay to see it? No way. If I'm bored one evening and its there for free? Yeah, I'd give it a go. If it turned out to be a damn good movie I'd want to watch repeatedly (I wish I chosen a better example...), I'd buy a DVD, Or pay for a legal down load a copy I could burn and keep.
> so many families were being tossed onto their lawns by bailed-out banks that had bullied them into bullshit mortgages.
Yes, banks put a gun to people's head and said: Borrow my money and nobody gets hurt.
The article makes more sense sarcastically, but it's a poor attempt at sarcastic commentary if that was the goal.
1) That the golden age for DVDs only lasted about 10 years. I think the golden age of cinema lasted from late 1920 to early 1960's. Acceleration in technology results in accelerated culture change and accelerated market changes. We're use to it in tech, but I didn't think much of other industries.
2) Along those lines, I was surprised this was such as revelation to the author. As soon as I saw Netflix go streaming, I knew this was the way I wanted my movies delivered. And the attitude in the OP seemed to be, "Hey, we can't make great movies and take risks on movies because you guys aren't buying DVDs." Innovative films never seemed to be big-budget anyway. And for an industry that's not use to change like technology is, they seem to fail to see that with new technology comes new business models, and new opportunities. I wonder how tech can educate hollywood on this.
I will claim to have pointed out that DVD was the last format five years ago: http://loewald.com/blog/?p=464
And, by the way, the point is that innovative indie movies don't make their money at the box office. They play in small numbers of art house cinemas, and then they used to sell DVDs. A lot of cancelled TV shows became phenomena on DVD. You can become a cult show on streaming and not make much money.
Given the debacle that was my experience with DVDs, I vowed I would never buy a Blu-Ray disk and I never have.
the golden age for DVDs only lasted about 10 years
One interesting hidden assumption deeply embedded in the biz is that big budgets are only for special effects and certain stars, and sometimes costume/makeup/sets although thats all getting adsorbed into "special effects". Obviously big budget never means the writers or any part of the creative team that doesn't involve makeup or blood spatters. Unfortunately that shows pretty strongly.
I would wager this budgeting anomaly is, in the long run, going to be a bigger disruptor to the biz than tech.
In other words, Hollywood is making shit products. They're just surprised that we're not buying them anymore.
Assuming people are like me and rarely watch a movie more than once unless it's exceptionally good, why pay $20-$30 or more for a DVD when you can rent it at RedBox for a buck or watch it on demand or on Netflix.
OK I bought the disk, but I can't make a backup copy or skip the ads and previews?
Oops, I dropped it or my kids got ahold of it, and now there is a little scratch on the disk, and it's entirely unplayable. Tapes were far more rugged, if slightly bulkier.
In that case I am far more unreasonable. I dont support MPAA, RIAA, etc. involved companies at all. My reasoning is that by supporting them you are supporting their lobbyists who will then introduce crazy laws like ACTA and SOPA. I'm just patiently waiting for them to die off.
Surely you are joking? What about parent's position strikes you as unreasonable?
Most people are just as "unreasonable" as the grandparent, which is to say that they are highly reasonable and you are the unreasonable one.
I don't know if you remember a film from about forty years ago, where the general public was exhorted to admit that they were, in fact, "mad as hell," and as result, "not gonna take it any more." People are currently mad as hell, and now we're seeing them decide (unsurprisingly) to not take it any more.
Hollywood would have to adapt, which means doing things in a very different way than they've done it so far, and that's not something they'd like to do. They'd rather try and hold on to what they have now for as long as possible.
And I think house of cards is relatively expensive. Even game of thrones cost 6 million per hour. How is this possible? I have no idea.
Excellently put.
These days, it seems the best movies are low budget, and worth buying a DVD of to keep. The big expensive "block buster" movies are very often watch once, enjoy for the moment, and forget. That can be cinema, netflix, torrents, who cares? The movie isn't actually worth caring about.
I think there is something to be said for the funneling of movie budgets into a few MASSIVELY costing movies (ie per the Spielberg interview that was posted on HN last week). I, myself, enjoy a good "Dark Knight", but also something like the King's Speech or The Tree of Life. The question is whether both can keep being made for their respective budgets, and both in film vs other media.
You seem to think that making awful movies is something new? it is not. These guys do a lot of testing to make sure their movies are wanted. As much as anyone can.
And the author doesn't seem to internalize what's become common knowledge in the music industry: the shiny savior disc (CD/DVD) was really masking the deeper disruptions in consumer behavior.
you can listen to a CD more than once in quick succession without permanently distorting it
you can play a particular track on demand
you can reproduce a disc without quality loss
rewinding a DVD is pretty quick
DVDs include subtitles; tapes didn't
CDs and DVDs are significantly smaller and easier to store than records and VHS tapes - I have a pocket-sized container that will safely hold a couple dozen CDs, but that would be fairly difficult with records.
In summary, CDs and DVDs are both vast technological improvements over vinyl and tape. And I have no idea what you're talking about with "And they were far more fragile."
> “What are the implications of that?”
> He looked at me incredulously, as if to say, Haven’t you run a studio? Then he said very emphatically, “The implications are— you’re seeing the implications—the implications are, those studios are frozen. The big implication is that those studios are—not necessarily inappropriately—terrified to do anything because they don’t know what the numbers look like.”
What does this actually mean?
Is there simply high uncertainties in P&L predictions, due to the difficulty in predicting international sales? There's a hard limit to the number of foreign movies some countries, notably China, allows so there could be massive fluctuations depending on whether it's good enough to send to China; and international tastes might be hard to predict. Or is it because the profit forecasts for every movie they do a P&L for falls short of what they can accept, and they put a magic "international sales" estimate in to push it over the line?
From what I understand, that they don't know what part of the Plan will be the one actually getting the most profit. And so they need to multiply their offers (and that increases the whole cost of the movie).
But to me, the important part is that this exact part is why we have yet another Spiderman and yet another Avengers movie on screens. Because as they are terrified, they are going to publish known beasts (movies), where they know the financial ratios.
If the disposable entertainment cash budget of the median consumer is dropping fast enough, and it seems it is, then they could create the worlds best movie and no one would spend money on it. So if there's no money to get, just go thru the motions and collect the paycheck until it stops, the output is going to be a crop of shovelware, which is a pretty accurate summary of the current situation.
>If a studio’s margin of profit was only 10 percent in the Old Abnormal, now with the collapsing DVD market that profit margin was hovering around 6 percent. The loss of profit on those little silver discs had nearly halved our profit margin.
This actually explains a lot about the studios' rabid antipiracy campaigns and their unwillingness to make everything available streaming. DVDs aren't a huge slice of the pie, but as a percentage of profit, it becomes a huge deal.
Well, maybe if they didn't swear blind that they never made a profit on any film ever and that actually they made a loss so there won't be any taxes, I'd have some sympathy.
The problem now is that DVD's are widely seen as an inferior format. Superficially, they have all the disadvantages of Bluray with inferior quality even to online streaming. Sure, they're pretty cheap, but not cheap enough to justify the lack of both convenience and quality. If online streaming killed DVD sales, Bluray was certainly an accomplice.
The reason Bluray hasn't gained as much traction as Hollywood hoped is that, in practice, its even more inconvenient for users than DVD's were. Bluray's are saddled with DRM so onerous that movies can take minutes to load and only a player with an internet connection to obtain updates has a chance to play the newest titles. Bluray discs almost universally have inferior user interfaces to DVD's, and the consistency is awful. BD-J discs often break basic player functionality such as auto-resume. On top of it all, Hollywood has continued to pile on more and more warning screens and advertisements. One of the selling features of the Bluray format, according to Hollywood, is that Bluray discs can download fresh new trailers online and show them to users instead of simply playing old trailers loaded on the disk. Yes, only Hollywood would call a program that downloads ads and makes you watch them a feature!
Compare this to online video. The quality is still inferior to Bluray, but it won't be that way forever, or even much longer. Arguably, the quality edge Bluray has is already pretty slim on the majority of display's people are using.
Hollywood should be serious about keeping Bluray competitive with online video. They make a lot more when you buy a movie on Bluray than they do if you watch it on iTunes. However, they clearly aren't. How do we know? They keep updating the encryption on Bluray discs, forcing people to keep up with updates to their players even though the updated encryption is frequently broken before the Bluray's using it officially go on sale. Every time a user has even slight difficulty playing a movie they just paid good money for, you drive another nail into the coffin of the Bluray format. They keep piling on trailers and warning screens. It still takes minutes to get to the movie with many Bluray's. Onerous anti-piracy ads are still being shown to the very people who have just paid for their content! Bluray menu interfaces remain inferior to those of DVD's, and consistency has not improved.
The obvious answer for Hollywood is to treat their best (i.e. most profitable) customers like their best customers, but this is simply not being done. Instead, they're looking for the next big thing to fix everything. 3D Bluray's! 4K video! 3D fatigue has already had an impact on cinema sales, but it'll be great in the home! (Disclosure: I own a 3D projector and have yet to watch more than 10 minutes of 3D to verify that it works). Yes, 1080p isn't good enough! 4K will be the savior of Hollywood, nevermind that the average viewer can't tell 720p from 1080p! The number is bigger, so they will come.
It's pretty hard to feel much sympathy for Hollywood these days.
I'm a professional film director.
I'm not sure that on an average-sized (say, 42" to be generous) home TV, I'd be able to tell 4k from 1080p.
If anyone thinks that's going to save the film industry, they aren't on a winner.
(And I also actively avoid anything with 3D where possible.)
This has a profound impact. I know longer know or even care what's coming out, or what's impending on DVD release. I know there's a new Star Trek movie, and the Hobbit came out a bit back, but I'm no longer edge-of-my-seat excited to see this because I haven't been being bashed about by promos for months. I'll wait for it to appear on Netflix, or maybe the Redbox thing. I saw Iron Man 2 on Netflix, so I figure I'll get to see part 3 there too.
People could go there and watch whatever trailers they like (and I think netflix could even suggest what they might like), and netflix would get some advertising dollars.
This is why the stuff we learn from Netflix's experiments with funding shows, which changes the pipeline, will do. Soon we'll have the Netflix funded movie production and it will be another shift in the bedrock of whose ass you have to kiss to get a movie made.
I feel sorry for the folks who were revered for their expertise before and are now worthless. But it is the way of these things. What the folks in the studios realize is that movies are still going to get made, but how they get made is going to change. And until the 'new' way has run a few movies through the pipeline and the new makers have figured out what it takes, its going to be scary.
I think the basic problem is that contemporary movie studios are publicly traded companies whose goal is to grow by 10% a year (or at least hit market growth rates). In some businesses, that's just not possible because of limits to the size of the market; book publishers, for example, have only rarely grown at market or above-market rates.
Books are an interesting example for a couple reasons: book publishers have been real businesses far longer than movie studios. In addition, studios for a long time set up businesses that relied on people repeatedly re-buying the same movie on different formats. Books have never really gotten away with that (although we might be seeing some re-buying like behavior in the shift from paper to digital). Now there's not an obvious successor to DVDs, and movie studios might become, or be becoming, more like book publishers.
* Further background reading: Edward Jay Epstein, The Hollywood Economist.
Just for a comparison, I've pirated one album since I subscribed to spotify (yeezus to check it out when it leaked).
My guess is when DVDs first became the craze there were only a handful of titles, as more titles were added people bought more - often going out to buy their favorites and classics for the sake of nostalgia. In this way Hollywood was making money by just re-releasing a lot of old content.
Now that all that 'catching up' has occurred and customers have already gone out and bought their favorite films, only new releases remain - and those are either a. underwhelming or b. not yet 'classic' status enough to bother owning.
Many people still subscribe to cable. I don't, but on some months I spend upwards of $100+ on movie tickets and Blu-Ray disks (Yes, I buy them.) Other months I realize I can do a zillion other things (go to a zoo or play golf) for what movie tickets cost.
Things are going to change, but the unique concentration of talent and intellectual property based around L.A. will be a force to be reckoned with for years.
Our family buys DVD's and watch them.
DVD's are a pretty costly way to sell movies. Retailers take a big slice. You have to create packaging, deal with inventory, distribution costs etc.
Regarding tech advance crushing DVD sales, 50% of profit.