Store pays for breaking street date (1 Viewer)

[DaveF]

Except this isn't a law, it's a business practice by studios. Are they really doing it to control potential monopolistic practices by retailers?

Regardless, these are reasons why "release-date" might be good for stores. But why do studios do it? What's the financial motivation for a studio to require all retailers to restrict release of a product until a certain date?

 

[MarkHastings]

Movies are done like this (well, except for the pre-screenings), so why would DVD's be any different?

EDIT: I was also thinking. Most retailers buy the number of DVD's they think they're going to sell. If a place like Wal-Mart has a distributor that can provide quicker shipments than Circuit City, then CC may not buy as many of the lesser popular titles due to a fear of everyone getting it from Wal-Mart before CC can provide it for sale.

Studios don't make money on how many titles the stores SELL, they make money on how many titles the stores BUY.

 

[JohnVB]

My guess is, not for financial reasons, they like to be able to track initial sales of their DVDs to help them prioritize what to put on DVD next. It may also help determine which kind of movies sell - adjust the box office tally a bit.

This would be a lot harder to track if the distribution channels weren't evenly paced.

Just my guess,

- bones

 

[Chad R]

I never said it was a law, I said it was the same theory, and it holds.

Studios don't want just one corporation controlling the distribution of their movies, because the same problem would arise: one corporation would hold too much power to control pricing and what not. If studios price a title where the store doesn't like it, they can refuse to carry that product costing the studio money (this is a real scenario that happened between Blockbuster and Dreamworks over American Beauty).

The short of it is that competition is good for the economy, good for the studios, and keeping the playing field level keeps competiton fair.

 

[Dan Rudolph]

Why is Terry can post the name of street-date-breaker Electronics Boutique, but I can't post the names of my examples? Both are long past. It's not like I'm telling people where to get pre-release DVDs.

 

[Aaron Reynolds]

Some of us like to buy from small retailers, people who know our names, our likes and dislikes, and who treat us well and offer great service.

As an owner/operator of a small business that survives on precisely these merits, I'd be an idiot to do my shopping at Wal-Mart.

 

[MarkHastings]

Why is that?

 

[MatthewLouwrens]

My guess: EB is in the news article, and it is an article that would be of interest to HTF members. Even if Terry didn't mention EB's name, people could get it from the article.

Plus, EB's ability to break street-date in the future willbe severely hampered. Your stores may break street date on future releases, and so it would be giving a signal to HTF members about where to go to find titles before street date.

 

[oscar_merkx]

what about some well known E tailers, does that apply to them as well ?

 

[Brian W.]

Yeah, I agree. I've heard tons of stories of DVDs available before street date at Walmart, Blockbuster, etc., but you never hear about any penalties for them. Why? Because the studios can't afford to withhold shipments from a major retailer like that. So once again, "the little guy" is made an example, while the big corporations get off scot-free.

 

[Aaron Reynolds]

Mark -- for the reasons I posted above the snippet you quoted. If I didn't value those things, I'd be saying that I don't stand a chance of surviving in my own business.

I value service and knowledge over saving a dollar.

 

[Cory-C]

I don't think that people are quite grasping the concept that EB did this quite blatantly with a HUGE title.

A Wal-Mart, Best Buy, Blockbuster, etc. will occassionally break the date with a title, but for the times it does happen -- 99% of the time it is a title that is not one of the big releases for the week. Many times it is a reissue of an older movie or the DVDs wind up in a box without a street date on them after they have been received and processed (which occassionally happens where I work).

When a date is broken on a bigger movie, it is definitely not company wide like EB. It is usually just an isolated incident that is harder to crack down on.

 

[Colin Jacobson]

Yeah, it usually seems to be with titles that are reissues or not "big" ones. When I was in Florida two weeks ago, I saw both new versions of The Good, the Bad and the Ugly and The Great Escape on the shelves at a prominent mall music/movie store. I seriously doubt they did this on purpose - they probably just thought these were restocked old titles...

 

[Cees Alons]

The essence of the story is: EB already has been caught....


Cees

 

[Josh Steinberg]

It's not that simple - it's not as though every video store in the country buys their DVDs directly from the studios. The larger, most popular chains can have contracts directly with studios, but medium and smaller sized stores often buy their films from another distributor. It's not about getting their acts together, or being more efficient, or anything like that - if a store or a chain wants several million copies of something, the studio will talk to them directly. If the local video store wants ten copies of something, they don't deal with the studio. It has nothing to do with them being unorganized or sloppy or anything at all like that. The reason for having street dates is so that all of these different stores have the opportunity to get the product by a certain date, allowing them to release it at the same time and leaving the decision of where to shop to the customer.

This is the same reason studios have something called MAP - minimum advertising price, which prevents stores from advertising the cost of titles if they sell them below a certain price. If Best Buy wants to sell ROTK for $5, hoping that the amount of money they lose on the DVD itself will be made up by increased overall business, that's up to them, but they can get in trouble for advertising it that low if the studio has set a MAP of, let's say, $19.99. That's why you'll see in flyers "Low price!" sometimes instead of the actual price.

While the system isn't completely fair and probably never will be, having things like street dates helps keep the playing field level.

 

[PerryD]

I'm wondering if my local Blockbuster is allowed to break street dates, at least for rentals. They had Pirates of the Caribbean out the weekend before, and just today I noticed that they had Return of the King out too.

 

[Paul Hillenbrand]

Wonder just how "company wide" EB was for breaking the date. Both EB stores in my area, Sacramento Ca, didn't have ROTK for sale, and one of the stores said they didn't receive their shipment, and if they did, it wouldn't go on the shelf before the 25th.

Paul

 

[TonyD]

quote:

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As an owner/operator of a small business that survives on precisely these merits,I'd be an idiot to do my shopping at Wal-Mart
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here is an interesting article that says video store owners also shop at wal-mart.

Rentailers Tempted by Mass-Merchant Prices

rentailers



well the link wont work so i posted much of the article.

 

[Doug Schiller]

That article makes no sense.
Since most of the times these prices are loss leaders, Wal-Mart and Best Buy only have to put on a 1 or 2 copy limit for the first few weeks and mister Captain Video is out of luck again.

 

[MarkHastings]

Can't the owner of Captain Video go back 18 times (to get all 36 copies)? or find a bunch of people to go a bunch of times? or go to several stores?