Studios Could Be Moving Towards a $30 Premium VOD Service Early Next Year

[Len]

Exhibitors, who have continued to whine about home entertainment while doing almost nothing to improve the theater-going experience, are likely bracing for another tectonic shift in distribution. For most of the 2010s, studios have been trying to figure out how to thread the needle on premium VOD, charging a higher cost to consumer to bring top-tier titles for home rental after only a few weeks in theaters. Universal toyed with a $50 home released for Tower Heist only two weeks after it had been released, but an uproar from exhibitors put the kibosh on that plan.

Now a new standard may be taking shape as Comcast, Apple, and Amazon are working on a delivery system to bring new release films home 30-45 days after they’ve been released for the cost of $30/rental. While that price tag may seem high, consider that if you were to go out to the theater to see a new movie, tickets can hover around $15, and the more people you bring over to your house to watch a new movie, the less the cost there is since everyone is pitching in (the person with the AppleTV or Amazon account would pay, but then everyone else could just Venmo the cost).

While $30 only 30-45 days isn’t as aggressive as studios might want—THR reports that studios would like $50 for a film that’s been out for only 17 days, a $30 price tag and a longer window could maybe sooth theater owners and also make for a more enticing prospect for consumers. It could also salvage box office for some films that didn’t demand people get out and come to the theater, but it could be good to invite some friends over and legally watch a new release movie.

Comcast, Apple, and Amazon are currently working out anti-piracy measures, and “A number of platforms, including the other major cable providers and digital players, will ultimately be a part of PVOD as well, since the goal is to saturate the marketplace.” Additionally, there will be some level of collaboration among PVOD providers to agree to a $30 price plan, since that’s going to be the goal to avoid consumer confusion.

However, they still need to get the studios on board. They need at least three studios, and they’re already ruling out Disney. Universal is the most likely to be involved since Comcast is the studio’s parent company, so that leaves 20th Century Fox, Warner Bros., Lionsgate, and Paramount. “No one will come out of the gate unless the majority of the industry is involved,” one studio executive tells THR. “There is safety in numbers.”

While the studios want theater owners on board and not have to labor under the threat that their movies might be refused exhibition if they go PVOD, the studios can also see the writing on the wall—people want to stay home rather than go to the movies. It’s sad, but with the exception of a few chains like the Alamo Drafthouse, theater owners haven’t offered a better product outside IMAX screeners. If people are going to be on their phones and talk while you eat overpriced popcorn, what’s the incentive to go to the movies?

It looks like PVOD is going to happen, and it’s just a matter of when. It could be as soon as January or February of 2018, and they could have big holiday releases to offer like Pitch Perfect 3 and The Greatest Showman.