Warner Brothers has stopped supplying discs of its latest releases to Blockbuster after the DVD rental chain refused to agree to a 28-day delay between the films going on sale and their availability to rent.
The move is the first step taken by Warner Bros to stimulate retail sales and make owning film content more appealing to consumers. It will be followed by efforts to expand similar release “windows” already in place with other movie rental services, such as Netflix and Redbox.
Blockbuster has rejected the Hollywood studio’s request for a 28-day window and has instead bought discs of Horrible Bosses and The Green Lantern on the open market in order to rent them to its customers.
“They felt it was important to continue to offer day and date rental so rather than work with us they went around us,” said Kevin Tsujihara, president of Warner Bros Home Entertainment. Blockbuster declined to comment.
“The question is: how do we make ownership more valuable and attractive?” said Mr. Tsujihara. “We have started the process of creating a window in bricks-and-mortar DVD and Blu-ray rental.”
Horrible Bosses and The Green Lantern are the first two titles to be released by Warner Bros through the Ultra Violet service, which allows consumers to store the movies in a cloud-based locker and watch them on a device of their choosing.
Hollywood has pinned its hopes on Ultra Violet to arrest the slump in hard format sales. But with an increasing number of consumers choosing subscription rental services – such as Netflix – over ownership, the industry has to convince consumers that buying movies represents good value for money.
Blockbuster was recently bought out of bankruptcy by Dish Network, the pay-TV operator, which has increased footfall in the chain’s retail outlets and recently created a $10-a-month subscription service to rival that of Netflix.
Netflix, which operates the largest streaming and DVD subscription service by users, has been battered in recent months by a tumbling share price. Shares in Netflix touched $300 in July but have since fallen to below $80.
Netflix currently has to wait 28 days to make Warner Bros titles available to its subscribers. Mr Tsujihara indicated that the studio wanted to increase that window. “The Netflix and Redbox deals are going to be expiring at the end of the year and beginning of next year and it’s likely we will try to extend those windows,” he said.
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