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Lions Gate Said to Plan Early VOD Release of ‘Abduction’

Aug. 9 (Bloomberg) -- Lions Gate Entertainment Corp. will offer the Taylor Lautner film “Abduction” on pay TV three months after its theatrical release for as little as $6.99, according to people familiar with the plan, undercutting rivals’ prices.

The film, scheduled for release in theaters on Sept. 23, will be offered through video-on-demand for about 10 days beginning Dec. 23, said the people, who spoke anonymously because the plan hasn’t been made public. The DVD release is set for January, one of the people said.

“Abduction,” with the “Twilight” actor in the lead, will be Vancouver-based Lions Gate’s first test of so-called premium VOD. Studios are experimenting with the earlier release of movies in an attempt to make up for declining DVD sales and rentals. The 91-day window is seen as a compromise from the 60-day plan, announced by four studios in the first quarter, that sparked protests from theater operators and filmmakers, including “Avatar” director James Cameron.

Sales and rentals of home videos fell 3.6 percent to $3.99 billion in the second quarter, the Los Angeles-based Digital Entertainment Group said on Aug. 5. Packaged discs, a category that includes DVDs and Blu-ray, declined 16 percent, the industry trade group said. A figure for DVDs alone wasn’t provided.

Wal-Mart, Best Buy

Lions Gate will offer “Abduction” for $6.99 in standard definition and $7.99 in high-definition formats, one of the people said. The studio plans to make the movie available to all VOD providers as well as the Web-based operations of retailers, including Wal-Mart Stores Inc. and Best Buy Co.

Lautner plays werewolf Jacob Black, one of three principal characters in Summit Entertainment Corp.’s “Twilight” films, a franchise that according to Boxofficemojo.com has generated $1.8 billion in worldwide ticket sales. The films are based on the young-adult novels of Stephenie Meyer.

Peter Wilkes, a Lions Gate spokesman, declined to comment on the company’s VOD plans.

Lions Gate today reported fiscal first-quarter net income of $12.2 million, or 9 cents a share, compared with a net loss of $64.1 million, or 54 cents, a year earlier. Sales in the period ended June 30 fell 20 percent to $261.3 million. The company said it benefited from lower movie marketing costs and higher television revenue.

March Agreement

Time Warner Inc.’s Warner Bros., Sony Corp.’s Sony Pictures, Comcast Corp.’s Universal Pictures and News Corp.’s Twentieth Century Fox agreed in March to release some films in six to eight weeks after the theatrical release through DirecTV Inc.’s Home Premiere service, charging $29.99.

The first film, Sony’s “Just Go With It,” was available on VOD April 21, about 10 weeks after its theatrical release. Typically, films are released in home-video formats four months after they open in theaters.

Opponents have said that a 60-day period threatened to reduce movie ticket sales because some consumers might wait to watch a film at home rather than go to the theater.

Lions Gate gained 26 cents to $6.62 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have risen 1.7 percent this year.

To contact the reporter on this story: Michael White in Los Angeles at mwhite8@bloomberg.net

To contact the editor responsible for this story: Rob Golum at rgolum@bloomberg.net

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