April 20 (Bloomberg) -- James Cameron and Peter Jackson are among 23 filmmakers who joined cinema owners in protesting plans by studios to offer 48-hour rentals through video-on-demand on DirecTV just two months after movies open in theaters.
Making movies available for home viewing early may “irrevocably harm the financial model of our film industry,” the filmmakers said in a letter distributed today by the National Association of Theatre Owners.
Cinema owners and filmmakers are challenging a plan by four studios to release some films for rental starting tomorrow through El Segundo, California-based DirecTV, the largest satellite-TV operator, for $29.99. Early release to home video will cost the industry millions of dollars in ticket sales and force some theaters to close, according to the letter.
“What sells for $30-a-viewing today could be blown out for $9.99 within a few years,” the authors wrote. “We ask that our studio partners do not rashly undermine the current -- and successful -- system of releasing films.”
DirecTV would consider dropping the price if customers aren’t willing to pay $29.99, Derek Chang, executive vice president of programming at DirecTV, said today in an interview. The timing of the VOD release, now set for about two months after the film’s theatrical release, also may change, he said.
“Like the price point, the 60-day window is something we’d have to evaluate down the road,” he said. “We’d have to evaluate it with our partners at the studios.”
Few movies are still generating revenue for cinemas after two months, Chang said.
Films are typically released for home viewing about four months after they appear in theaters, according to the letter.
Regal Entertainment Group Chief Executive Officer Amy Miles said in March that her chain, the largest in the U.S., won’t show films that are scheduled for home viewing four to six weeks after the theatrical release, a time frame suggested by DirecTV Chief Executive Michael White on a Feb. 23 conference call.
Gerry Lopez, CEO of AMC Entertainment Inc., the second-largest chain, has said he opposes a window shorter than about 90 days. Regency Theatres, based in Calabasas, California, will pull “Just Go With It” from theaters, President Lyndon Golin said yesterday.
Cameron’s “Avatar” is the top-grossing film of all time with $2.78 billion in worldwide ticket sales, according to Box Office Mojo. Jackson directed “The Lord of the Rings” trilogy, which collectively took in $2.91 billion globally, the researcher said.
Other filmmakers who signed the letter include Michael Mann, who directed “Public Enemies,” and “Pirates of the Caribbean” director Gore Verbinski.
Adam Sandler Comedy
DirecTV will offer Sony Corp.’s “Just Go With It” tomorrow as the first movie in its premium video-on-demand film service. The comedy, featuring Adam Sandler and Jennifer Aniston, was released on Feb. 11 and was still in theaters last weekend.
Universal Pictures, Warner Bros. and Twentieth Century Fox also will supply films to the service two months after their theatrical release, Jade Ekstedt, a spokeswoman for DirecTV, said yesterday.
In the next few weeks, DirecTV will offer “The Adjustment Bureau” from Comcast Corp.’s Universal Pictures, “Cedar Rapids” from News Corp.’s Twentieth Century Fox and “Hall Pass” from Time Warner Inc.’s Warner Bros., Ekstedt said. All three are still in cinemas, according to Box Office Mojo.
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