Sony Pictures, Warner Bros. and Walt Disney Co. are in talks with the largest cable TV systems to offer films for as much as $30 per showing soon after they run in theaters.
The studios are talking with In Demand, a partnership of Cox Communications Inc., Comcast Corp. and Time Warner Cable Inc., Bob Benya, chief executive officer of In Demand, said in an interview. Disney is also discussing streaming films on Web-linked devices such as Microsoft Corp.’s Xbox console and Sony’s Corp.’s PlayStation 3, people with knowledge of the talks said.
Hollywood studios have been looking for ways to generate additional sales from movies as DVD purchases continue to decline. A so-called “premium” service would let consumers see movies on TV without waiting the typical three or four months for DVDs or cable companies’ $4 or so on-demand showings.
“I think there are a number of other products that we will be able to create through Internet-connected television, particularly when you consider our brand focus,” Robert Iger, CEO of Burbank, California-based Disney said at a Goldman Sachs Groups Inc. conference on Sept. 21.
Sony Corp. tested the market with users of its Bravia TV by offering the Will Smith movie “Hancock” in 2008 and the animated film “Cloudy with a Chance of Meatballs” in 2009 for $24.95. The Tokyo-based owner of Sony Pictures hasn’t announced plans for another movie through its TV sets.
Time Warner Inc. Chief Financial Officer John Martin told the Goldman Sachs conference in New York last week that the company’s Warner Bros. studio expects to begin tests on the service later this year. He said he expected the offering to be priced at $20 to $30 per viewing.
Disney is likely to test consumer interest in the first quarter using a single film, said one of the people, who requested anonymity because the decisions are pending. The company hasn’t decided on pricing or how long to wait after theatrical release, the person said. Jonathan Friedland, a Disney spokesman, wouldn’t comment on the plan.
Patrick Seybold, a spokesman for Sony’s PlayStation network, declined to comment, as did Jim Kennedy, a spokesman for Sony’s film division. An outside public relations representative for Redmond, Washington-based Microsoft didn’t respond.
Disney, the world’s largest media company, rose 46 cents to $33.58 on Sept. 24 in New York Stock Exchange composite trading. New York-based Time Warner added 61 cents to $31.37. Sony’s U.S. traded shares gained 94 cents to $31. Time Warner Cable, also based in New York, advanced $1.46 to $53.11, and Philadelphia- based Comcast, the largest U.S. cable system, was up 65 cents to $18.57 on the Nasdaq Stock Market.