Samsung Halting Blu-ray Disc Player Production

Samsung is stopping production of 1080p and 4K Blu-ray Disc players for the United States market — leaving Sony, Panasonic and LG as the last CE manufacturers supporting the next-generation packaged media format.

The South Korean company had been working on a follow-up to the UBD-M9500 4K BD player, which has now been scrapped. Samsung last bowed a new BD player in 2017.

Though speculated after Samsung didn’t showcase any new BD players at CES in Las Vegas in January, the company confirmed the move in a media statement.

“Samsung will no longer introduce new Blu-ray or 4K Blu-ray player models in the U.S. market,” a spokesperson told CNET.

Samsung’s decision follows the exit of Oppo Electronics Corp., the Chinese company known as Oppo, which ceased production of a 4K BD player last year.

While observers contend the move could be due to Samsung backing its proprietary HDR10 and HDR10+ high dynamic range formats versus Dolby Vision, a more realistic reason is market forces.

For the week ended Feb. 9, 4K Blu-ray accounted for just 5% of sales of the top 50 titles, according to VideoScan. That compared with nearly 40% for Blu-ray and 55% for standard DVD.

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Indeed, pending Oscar-nominated new release  The Favourite (20th Century Fox Home Entertainment) and Stan & Ollie (Sony Pictures Home Entertainment), reportedly are not getting 4K UHD releases, while Oscar nominee Bohemian Rhapsody and Widows (Fox) are.

Regardless, home entertainment studios remain bullish on 4K UHD.

Format sales surged nearly 70% in the third quarter last year, according to DEG: The Digital Entertainment Group. There were 392 4K Ultra HD Blu-ray Disc titles available in Q3 representing more than $162 million in consumer spend for the period, and 595 4K titles available digitally.

“4K UHD discs already account for almost one in 10 new release discs sold in the U.S,” Eddie Cunningham, president of Universal Pictures Home Entertainment, told Media Play News.

Paramount Home Media Distribution boss Bob Buchi in January said the studio would offer most of its theatrical releases on 4K UHD Blu-ray, as well as select catalog titles.

“The response to our catalog 4K releases has been very promising, so we expect to see increased interest in owning treasured classics in the very best format available,” he said.

 

EMA Growing Membership Commitment and Expanding Into OTT, Says CEO

LAS VEGAS — The Entertainment Merchants Association hailed the growing commitment of its membership at a meeting Jan. 8 during CES.

“The engagement of our members over the past year I think is more than we’ve ever seen,” said president and CEO Mark Fisher.

“It’s been an interesting year in the industry and for our association,” he said, noting the growth of digital purchase storage locker Movies Anywhere and the expansion and churn in the OTT space (including pending streaming services from Disney and WarnerMedia).

“We initiated a focus on OTT channels” in the past year, he said, in addition to EST and disc, which “is not dead.”

He noted that the EMA had a “very successful OTT conference” at the Los Angeles Entertainment Summit in July, which had to downsize its budget.

The organization “learned how to operate a conference at lower cost,” during the July 2018 LAES.

But the EMA is focused on the entertainment delivery systems of the future. Fisher noted that, in July, DEG: The Digital Entertainment Group, the EMA and MovieLabs formed the Digital Supply Chain Alliance to strengthen the digital supply chain.

“That alliance have proven to show really rapid results,” he said.

Mitch Mallon, CEO of Stadium Media and chair of the digital EMA steering committee, added that EMA digital membership has grown, digital events have expanded and that the committee has created six white papers.

In the coming year, the committee “will be focusing on how OTT is starting to move out into the European marketplace,” he said, including launching a new project to list digital platforms around the world.

Steve Apple, VP, industry sales at the EMA, moderated a discussion on the OTT market.

Panelist Jason Peterson, CEO of GoDigital Media Group, noted that international markets and cultures require a different approach, including mobile, non-cash, non-banked payment opportunities.

“We’ve really focused on the Hispanic audience,” he said.

Panelist Tricia Lee, SVP, product and development, Sony New Media Solutions, noted that focusing on a rabid fan base can be key in the OTT space, referencing her work building Funimation’s service, which has “hyper-attention fans” in the anime space.

The key is authenticity, she said, adding consumers “are looking for shared experiences, and it has to be authentic.”

Services “need culturally significant content to cut through that clutter,” Peterson added.

Home Entertainment Community at CES 2019

Home entertainment executives again gathered for the annual DEG: The Digital Entertainment Group reception Jan. 8 in Las Vegas during CES 2019. The DEG honored Warner Bros. with the Excellence in 4K UHD Content Award for Stanley Kubrick’s 2001: A Space Odyssey 4K Ultra HD Blu-ray Disc, and Sony Electronics with the Excellence in 4K Product Award for its Sony Master Series A9F OLED TV. Dolby Labs was presented with the Emiel N. Petrone Innovation in Entertainment Technology Award for Dolby Vision, an imaging innovation developed in collaboration with a wide range of studios, creatives, and post-production partners.

Streaming, TVOD Fuel Consumer Spending on Home Entertainment to Record Heights

Consumer spending on home entertainment hit a new record in 2018, buoyed by subscription streaming as well as transactional video-on-demand (TVOD), DEG: The Digital Entertainment Group announced Jan. 8.

Total consumer spending on home entertainment during the year shot up to an estimated $23.3 billion, up 11.5% from total consumer spending in 2017, the DEG said, noting that figures are preliminary. Final numbers will be issued in early February.

As expected, subscription streaming — chiefly through Netflix, Amazon Prime Video and Hulu — led the way, with a 30% year-over-year gain to $12.9 billion.

Consumers spent an estimated $2.46 billion on digital purchases of movies, TV shows and other content, up 14.4% from what they spent in 2017.

They spent another $2.09 billion to stream movies on demand, the electronic equivalent of renting a DVD or Blu-ray Disc, up 6.2% from the prior year.

Total spending on TVOD, the DEG estimates, came in at $4.55 billion, a healthy 10.5% spike from TVOD spending in 2017.

Total disc sales continued to fall, despite the growing popularity of 4K Ultra HD Blu-ray, with consumer spending on physical media in 2018 coming in at an estimated $4.03 billion, a 14.6% drop from the prior year.

In the fourth quarter, home entertainment spending was particularly strong, with an overall gain of 13% to $6.3 billion.

Subscription streaming the fourth quarter was up 30% to an estimated $3.49 billion, while EST rose 20.2% to $664 million and on-demand streaming was up 21.8% to nearly $517 million.

Combined consumer spending on DVDs and Blu-ray Discs in the fourth quarter of 2018 was $1.24 billion, down 14.8% from the fourth quarter of 2017.

Sales of 4K UHD content rose 70% during the year and 46% in the fourth quarter. The number of 4K Ultra HD Blu-ray titles available in the market grew to 445 titles, with another 682 4K titles available digitally.

The box-office performance of films released in the year rose nearly 15%.

Among the bestselling film titles released on 4K for the home in 2018 were: Justice League (Warner Bros.), Ready Player One (Warner Bros.), Mission: Impossible — Fallout (Paramount), Jurassic World: Fallen Kingdom (Universal Pictures), Deadpool 2 (20th Century Fox) and Avengers: Infinity War (Walt Disney Studios).

4K UHD TV penetration rose 61% over the year-earlier period, to 48 million households, DEG says. Also during the year, penetration of 4K-capable player devices (game consoles and set-top boxes) rose 66%, to 13 million homes.

 

 

DEG Forms Direct-to-Consumer Alliance

DEG: The Digital Entertainment Group has formed the DTC Alliance as a subset of DEG membership.

“Every major media company and TV network will launch a Direct-to-Consumer (DTC) streaming service in the next five years representing a significant new chapter in how television and film content is purchased, accessed and consumed,” the DEG stated in a release. “As DTC streaming currently is a longtail situation with a few high-reach apps and many low-reach services, DEG’s DTC Alliance is designed to support direct-to-consumer media services of all sizes to tackle difficult challenges and coordinate voluntary best practices and initiatives; advocate for the industry by presenting a common front to the commercial community; and promote member channels through campaigns aimed at building awareness among consumers, as well as through industry-leading events.”

Under the umbrella of the DTC Alliance, DEG has established six committees to set objectives and agendas in the following areas: Marketing Nomenclature, Data Analytics, International Expansion, Rights Repository, Title Availability Directory and Uniform Metadata Standards.

“With the DTC Alliance, DEG is bringing together DTC content companies and service providers to build a robust and efficient marketplace for all players, and to promote the new DTC experience to consumers,” said Amy Jo Smith, DEG president and CEO. “DEG has a track record of more than 20 years in bringing new media platforms, including DVD and Blu-ray Disc to market. We are very excited to apply this extensive market-building experience to the DTC arena, and encourage all appropriate companies to participate in setting the DTC Alliance’s initial objectives and a forward-looking agenda for this new industry.”

DEG Honoring Dolby Vision, Sony Electronics and Warner Bros. Home Entertainment at CES

DEG: The Digital Entertainment Group is set to honor Dolby Vision, Sony Electronics and Warner Bros. Home Entertainment Jan. 8 at its annual industry event at CES in Las Vegas.

The trade group will use the reception to showcase its Achievement Awards honoring the best 4K UHD hardware and software products released during calendar 2018. Dolby Vision will also be honored by DEG leadership with the DEG Emiel N. Petrone Innovation in Entertainment Technology Award.

Named in memory of DEG’s founding chairman Emiel N. Petrone, DEG recognizes Dolby Vision, Dolby Labs’ imaging innovation developed in collaboration with a wide range of studios, creatives, and post-production partners. The technology has created new opportunities for the home entertainment industry.

Selected by a panel of product reviewers from the industry’s home theater enthusiast and business publications, the DEG: Excellence in 4K UHD Awards include Stanley Kubrick’s 2001: A Space Odyssey 4K Ultra HD Blu-ray Disc from Warner with the DEG: Excellence in 4K UHD Content Award.

DEG cited the title’s demonstrated excellence in 4K image capturing/transferring; HDR encoding; wide color rendering; and immersive audio.

The DEG: Excellence in 4K Product Award honored Sony Electronics for its Sony Master Series A9F OLED TV. For the Product Award, DEG cited Sony’s consistent delivery of “outstanding” audio/video performance, convenience and versatility.

“DEG member companies move quickly to meet consumers’ desire for more immersive home and mobile viewing experiences, and they regularly introduce consumers to new possibilities,” DEG CEO Amy Jo Smith said in a statement. “DEG is delighted to recognize Sony Electronics, Warner Bros. Home Entertainment and Dolby Laboratories as purveyors of best-in-class viewing experiences.”

2019: Home Entertainment to Thrive on Change

If there’s any truth to the adage “change or die,” then the home entertainment business has plenty of life left in it as we begin 2019.

The coming year will bring significant changes, as studios and distributors continue to rejigger business models to reflect changing consumer habits domestically and worldwide.

Walt Disney will finalize its merger with 20th Century Fox, leaving Hollywood with five major studios, not six. AT&T will continue the integration process with the former Time Warner, now known as WarnerMedia.

And if you thought subscription streaming had a banner year in 2018, 2019 will likely see even bigger growth, with the emergence of at least two formidable challengers to longtime market leader Netflix.

Walt Disney will finally launch its much-ballyhooed SVOD service, Disney+, with a focus on the same content that rules at the box office: “Star Wars” and all things Marvel. The first “Star Wars” live-action series, “The Mandalorian,” should arrive later this year, and Disney recently announced a prequel series based on Rogue One character Cassian Andor (played by Diego Luna). Disney also confirmed Disney+ is developing a live-action Marvel series centered around Loki, from the “Avengers” movies.

Not to be outdone, AT&T’s WarnerMedia also plans on launching a direct-to-consumer streaming platform in 2019, with three different services, including a premium one fronted by HBO, home of mega-hit “Game of Thrones.”

The latest numbers from DEG: The Digital Entertainment Group show consumer spending on subscription streaming grew 30% in the first nine months of 2018.  If that growth rate held up through the end of 2018, then consumers will have spent nearly $12.3 million on subscription streaming, or SVOD (subscription video-on-demand).

How high consumer spending on SVOD will grow in 2019 remains anyone’s guess, although observers believe continued double-digit gains in line with prior years is the most likely scenario as consumers continue to “cut the chord” with pay-TV services.

Last August, research firm eMarketer said it expected the number of U.S. cord-cutters — adults who have canceled a pay TV service and continue without it — to climb by 32.8% in 2018 to 33 million. The number of subscription OTT video service viewers, meanwhile, was on track to rise to 170.1 million, or 51.7% of the U.S. population.

The “VOD” that the studios are most intent to grow, transactional VOD, posted a surprising growth spurt in the third quarter of 2018 — 18% for electronic sellthrough, or EST, and 10% for digital rentals.

Michael Pachter, a senior media analyst with Wedbush Securities in Los Angeles, doesn’t see SVOD making much of a dent in TVOD in 2019.

“Transactional VOD should be relatively flat, as Netflix has few — if any — programs that people typically rent,” he said. “They have no new movies — once Disney pulls its films — and few current TV shows, although I suppose some TVOD is for older television series.  My sense is that the bulk of TVOD is new movies, with some catchup TV from current season TV shows, neither of which is carried on Netflix to any great extent.”

Jim Wuthrich, president, Warner Bros. Worldwide Home Entertainment and Games, agrees that the transactional business and streaming can peacefully co-exist.

“Consumers have more choices for content than ever before, and on demand streaming services are increasingly their go-to option,” he said. “On an aggregate basis, the streaming services have helped transactional services become mainstream, encouraging consumers to connect their devices to on-demand video.

“On a title basis, transactional demand drops when it’s on a major SVOD service, but transactional demand returns when the title rolls off the service. Ultimately we are competing for consumer attention and transactional services generally offer first in-home viewing and always on availability – a distinct and unique proposition.”

Looking ahead, Amy Jo Smith, president and CEO of DEG: The Digital Entertainment Group, says 2019 will be the most exciting yet for digital media.

“2018 has been a lot about the notion of how transaction and subscription distribution models can co-exist, and content owners have begun to lay foundations for their direct-to-consumer businesses,” Smith said. “In 2019, we will see the world’s biggest content owners actually beginning to deliver very high-profile entertainment directly to consumers, and as they do that they will gain the most detailed view yet of who their customers are and what their fan base craves.

“As a result, content owners will become smarter about how to reach consumers and the content delivery experience will improve. As direct-to-consumer offerings multiply, consumers will continue to sort out what is meaningful for them. They will prioritize the content they find worthy of collection and also decide what provides value for a monthly subscription.”

Accordingly, studio executives agree that in 2019, their No. 1 priority will be to continue to growth the transactional, or on-demand business — both physical and digital.

“We are taking a deep dive into consumer behavior as we continue to navigate the changing home entertainment landscape,” said Bob Buchi, president, worldwide home media distribution, for Paramount Pictures. “We’ll be sharing the results of quantitative and qualitative studies with our retail partners to work with them on crafting innovative strategies for reaching consumers and driving transactional sales.

“There is untapped potential in light and lapsed consumers who may have slowed their entertainment collecting and ongoing opportunity with heavy users who value high quality offerings. We’re going to work with our retail partners to maximize our learnings and strategically target diverse consumer groups.”

“Our focus remains on delivering a product offering and value proposition that enables the best consumer experience to continue the expansion and adoption of digital sell-through (and VOD for that matter),” said Michael Bonner, EVP of digital distribution at NBC Universal. “Improving these experiences through product enhancements like premium formats or interactive extras along with embracing new services like Movies Anywhere are just a few examples of how we’re investing as an industry.”

Warner’s Wuthrich agrees. “We believe there’ll be continued growth in digital transactions in 2019,” he said. “We have great momentum coming out of 2018 and have a number of programs to remind movie and TV fans that their favorite content is a click away. In addition to using performance marketing to help connect consumers with the content they love we’ll be introducing a fresh approach to advertising.”

Ron Schwartz, president of Lionsgate Worldwide Home Entertainment, said the key points on his agenda for 2019 are “continuing to create progressive windowing and focused strategies for our specialty and multi-platforms releases, and continuing to grow the digital business while maximizing results on the physical side.”

“Lifecycle management is more critical than ever, particularly with franchises,” he said. “For example, we’ll be working with our partners on compelling catalog initiatives such as ‘John Wick’, as well as on the third installment, throughout the distribution windows, providing more access and innovative marketing to keep fans engaged.”

As consumer habits continue to evolve, digital movie sales and rentals — electronic sellthrough (EST) and transactional video-on-demand (TVOD) — will remain a priority, Schwartz said.

“We saw a significant increase in industry spending in this area in 2018, up 20%, and we will continue to collaborate with our retail partners on fresh ideas to keep consumer interest alive,” he said. “We see a large and growing market with multi-platform and specialty releases and will continue to build our leadership in this area.”

While studio executives agree their focus on 2019 will be to grow the digital side of the business, they aren’t giving up on the physical disc — particularly with the rapid acceptance of 4K Ultra HD.

“4K will continue to gather momentum as more consumers experience the incredible quality of the content on their 4K televisions,” said Paramount’s Bob Buchi. “Paramount will offer most of our theatrical releases on 4K UHD Blu-ray, as well as carefully chosen titles from our vast library.  The response to our catalog 4K releases has been very promising, so we expect to see increased interest in owning treasured classics in the very best format available.”

“Consumers decide how, when and where they want to experience our content, and the physical disc remains a valuable option for them,” adds Chris Oldre, EVP of pay TV, digital and international distribution at Walt Disney Direct-to-Consumer and International.

“We view the business holistically, with physical and digital ownership as one market. Our continued commitment to including the digital code delivers the added value of streaming, too, and the introduction of Movies Anywhere as a simple, fast method to redeem that code delivers the best of both worlds — physical and digital — in one experience.”

Oldre said he’s particularly excited “about the incredible range of content that will be offered by Disney in 2019, and with our continued commitment to delivering best-in-class experiences, we’re looking forward to another exciting year across both physical and digital platforms.”

“The home entertainment releases of Ralph Breaks the Internet and Mary Poppins Returns will offer the kind of trusted family entertainment that Disney is known for,” he said. “Later in the year we’re introducing a new Marvel character to the home entertainment audience with Captain Marvel, and we will be closing out a truly iconic series with Avengers: Endgame.

“In addition, Disney’s brands and franchises are content that consumers want to own and a significant portion of our revenue comes from our library of classic and timeless titles that continue to entertain generation after generation.”

In the first quarter on 2019, Oldre said, “we’ll be celebrating the eagerly anticipated 30th anniversary of The Little Mermaid.  Those are just a few of the highlights of the year ahead, which will see us continue to roll out releases in 4K UHD, as well as continuing to focus our efforts on growing Movies Anywhere and educating consumers about the ease of building a digital library.”

Independents, meanwhile, are looking for whichever distribution channels and platforms that make the most sense.

“I am really focused on watching three exciting trends that will have enormous impact on the ever-changing entertainment landscape,” said Bill Sondheim, president of the Cinedigm Entertainment Group, who in November 2018 took on additional duties as President of worldwide distribution.

“First is the battle for SVOD dominance that really starts in earnest when Disney launches its direct-to-consumer streaming service to compete head on with Netflix,” said Sondheim, who in his expanded role continues to lead the company’s growing China/North America business pipeline, in addition to managing distribution in the rest of the world.

“This will likely create audience migrations that will have far reaching impact on the mid-tier SVOD players more that the top-tier providers,” Sondheim said. “The second trend to watch is AVOD’s explosive growth, which may be a prime beneficiary of the audience shifts that will occur in the SVOD battles mentioned above. The AVOD segment has long been the held back due to lower quality content or older catalog offerings, but as the cost of SVOD consumption grows, the AVOD alternative is rapidly evolving with higher caliber brands and newer content that will drive audience adoption.

“Finally the arrival of 5G broadband will start to demonstrate the impact of true high speed wireless connections. While it will likely be more than two years before we have a true nationwide network, 5G will start to make an impact in most major cities later this year.”

“Buckle up,” he added. “It is going to be a year of massive growth and further disruptive change.”

2018: Getting Along in a Multi-Platform World

Back in 1989, a State Department official named Francis Fukuyama wrote a controversial essay on the “end of history,” opining that the collapse of the Soviet Union and Eastern bloc communism, the reform movement in China, and the reunification of Germany signaled a triumph for Western democracy and a very real promise of freedom and liberty for all.

Fukuyama’s vision of a global utopia didn’t last long, but for a brief moment in time cultural and political differences seemed to be set aside in favor of everyone working together to make the world a better place.

Similarly, in 2018 the various factions in home entertainment seemed to set aside their differences and recognize that we’re living in a multi-platform world — and that a peaceful coexistence between disc and digital, subscription and transactional, was, indeed, possible.

“2018 saw the continued integration of technology and content at an even more accelerated pace, and, with that, the opportunity to engage fans with more focused and meaningful experiences that extend the life of our film and television properties,” said Keith Feldman, president of worldwide home entertainment for 20th Century Fox.

Indeed, studios cut back on selling content to Netflix — most notably Disney, which pulled all its movies off the service by the end of the year — in favor of issuing it on their own platforms. They rallied behind Movies Anywhere, a digital movie storage “locker” launched in October 2017, and saw digital movie sales soar, with an 18% gain reported in the third quarter of 2018, according to DEG: The Digital Entertainment Group numbers.

Netflix, meanwhile, vowed to spend $8 billion in 2018 on producing its own shows, with the goal of making its content library 50% original.

Studios that once sued Redbox for renting DVDs and Blu-ray Discs, claiming the kiosk vendor was cannibalizing disc sales, struck distribution deals in which prior holdbacks were either sharply cut back or eliminated. They also rallied behind Redbox On Demand, a digital movie store launched in December 2017.

On the retail front, big-box chains like Best Buy and Walmart put discs back into the spotlight, buoyed by the emergence of 4K Ultra HD Blu-ray.

And digital retailers like FandangoNow and Google Play revved up their promotional muscle and pumped up the message that they had fresh movies for sale or rent. FandangoNow even put up a notice on its home page, touting the fact that it offers “New releases not on Netflix, Hulu or Amazon Prime subscriptions.”

It was all part of a bigger picture, in a year dominated by major media mergers — AT&T buying Time Warner, Disney buying 20th Century Fox — suggesting it was high time to come together and restructure existing business models to reflect changing consumer habits.

Content, as always, was king, but the feuding fiefdoms of the past were at last coming to peace with each other — and with themselves.

Subscription streaming continued to dominate the home entertainment business in 2018. Indeed, in the first nine months of this year, according to DEG: The Digital Entertainment Group, consumer spending on Netflix and other subscription streaming services rose more than 30% to $9.4 billion, nearly $2 billion more than consumers spent on all other forms of home entertainment combined– disc purchases ($2.79 billion) and rentals ($1.37 billion); digital purchases, or electronic sellthrough (EST, $1.8 billion),  and digital rentals, or transactional video-on-demand (TVOD, $1.57 billion).

But where Hollywood once saw a threat, in 2018 the studios saw an opportunity. As consumers, thanks to streaming, became increasingly accustomed to viewing movies and other content electronically, studios focused on moving them toward on-demand digital purchases or rentals — driving home the message that new releases aren’t typically available through subscriptions.

“Our comprehensive and strategic efforts to drive digital ownership and bolster engagement such as leveraging the early window, offering exclusive extras and emphasizing the best viewing experience possible are proving to be very effective as consumers continue to move toward and embrace the digital experience,” said Chris Oldre, EVP of pay TV, digital and international distribution at Walt Disney Direct-to-Consumer and International.

“Movies Anywhere has had a tremendous impact on transforming digital consumption and is a testament to the strength of the studios and digital retailers that have joined forces on an unprecedented scale. This year Disney once again experienced remarkable growth as our digital sales exceeded expectations in conjunction with the studio’s unrivaled box office success. Disney has the top three bestselling digital titles to date with Avengers: Infinity War, Black Panther and Thor: Ragnarok. We’re also incredibly proud of our celebration of Marvel’s 10-year anniversary this year.  We promoted the Marvel Cinematic Universe home entertainment catalog with a special sales promotion across digital, which undoubtedly helped propel Avengers: Infinity War to the No. 1 live-action spot on the all-time digital sales chart in a record-setting period.”

Ron Schwartz, president of Lionsgate Worldwide Home Entertainment, said that as consumer habits evolve, digital movie sales and rentals – electronic sellthrough (EST) and transactional video-on-demand (TVOD) — remain a priority. “We saw a significant increase in industry spending in this area in 2018, up 20%, and we will continue to collaborate with our retail partners on fresh ideas to keep consumer interest alive,” he said. “We see a large and growing market with multi-platform and specialty releases and will continue to build our leadership in this area.”

At the same time, Schwartz notes, “Disc sales remain robust … 4K UHD BD is rapidly gaining in popularity, as spend is on track to double this year versus last. We are committed to serving our audiences across the full spectrum of the digital   and physical business and we will continue to be a first mover in adapting these businesses as they continue to evolve.”

For Bob Buchi, president of worldwide home media distribution at Paramount Pictures, 2018 was the year of 4K.

“More than 42 million homes now have a 4K Ultra HD television and roughly 400 titles are available on 4K Ultra HD Blu-ray Disc and over 600 on Digital 4K,” Buchi said. “The numbers keep growing and for good reason: 4K brings home entertainment to life like never before, delivering content that better represents filmmakers’ original vision.  We’ve seen this play out with the week one 4K sales of Mission: Impossible — Fallout, which delivered our highest number of UHD discs sold, as well as the highest percentage of our physical sales ever.”

Disney’s Oldre agrees. “4K Ultra HD is a robust line of business for us and we’re experiencing healthy growth,” he said. “We continue to receive solid support from our physical retail partners and are confident it’s a market that our customers will continue to embrace given the format’s premier resolution.”

Catalog sales were another bright spot in 2018, Buchi said. “We’ve seen our digital catalog sales growing in markets around the world, including a 35% increase domestically through October, which indicates that more and more consumers have become comfortable with the format and are returning to the concept of building collections.  In addition, physical catalog sales have exceeded our expectations, as we continue to make concerted efforts to celebrate anniversaries of classic titles and strategically promote films from our library.”

Retailers certainly did their part in pushing the transactional business. At Best Buy and Walmart, the emergence of 4K Ultra HD Blu-ray led to bigger disc sections and, in the case of Best Buy, placement back in the center of the store.

Redbox in 2018 relaunched its brand, which included some major ad campaigns and sponsorships, including the Redbox Bowl college football game on New Year’s Eve at Levi’s Stadium in Santa Clara, Calif. The company also revamped its loyalty program; negotiated more favorable distribution deals with studios; and expanded the availability of previously rented movies and video games at kiosks.

The Redbox On Demand digital service, meanwhile, celebrated its first birthday in December with a new app on Vizio SmartCast TVs. The company also expanded its selection to 12,000 titles, from 7,000 at launch. CEO Galen Smith in December told Media Play News that Redbox On Demand has “surpassed major milestones to become a real player in the competitive digital home entertainment space. We’re seeing hundreds of thousands of customers, including bringing back folks we haven’t seen in a while.”

FandangoNow, a business unit of movie-ticket seller Fandango, struck deals with most major studios that allow it to package movie rentals into “binge bundles” that let consumers watch multiple movies at a lower price. The new offering launched on the Labor Day weekend with more than 100 bundles.

FandangoNow also cross-promotes digital movie sales and rentals with ticket sales. In December, just before the holidays, consumers who spent $20 on FandangoNow received $8 toward a movie ticket.

In the end, studio executives agree, it all comes down to keeping consumers engaged — which requires constant work.

“From a functional solution like Movies Anywhere that allows consumers to build and enjoy a streamlined digital library, to premium viewing with 4K HDR, to story extensions through virtual reality and other emerging formats, keeping consumers invested and engaged requires constant experimentation and innovation,” says Fox’s Keith Feldman. “Our ongoing challenge is to exceed consumer expectations today and simultaneously deliver next-generation offerings that will continue that engagement in the future.”

Home Entertainment 2018 Year-in-Review

The home entertainment industry was busy in 2018 in the shadow of ongoing major media mergers, as studios and distributors rejigger business models to reflect changing consumer habits domestically and worldwide. Here’s our annual recap of the year in home entertainment,  as covered in Media Play News.

 

January

  • DEG: The Digital Entertainment Group announced that home entertainment spending in 2017 increased 5.26% to $20.5 billion, from $19.5 billion 2016. As expected, gains came largely from digital (streaming video and transactional VOD), with total digital spending up nearly 20% to $13.7 billion.
  • Ron Sanders, longtime home entertainment chief, added president of worldwide distribution for the entire Warner motion picture group to his duties as part of broader studio restructuring.
  • Rollout of premium video-on-demand (PVOD) officially died after the CFO of the country’s largest theatrical chain said discussions with studios remained at an impasse. Speaking at Citi 2018 Global TMT West Conference in Las Vegas, AMC Entertainment CFO Craig Ramsey suggested negotiations with studios had cooled and that there was “no consensus” on PVOD.
  • Netflix said it added a record 8.3 million net subscribers in the fourth quarter of 2017 (ended Dec. 31) to finish the year with more than 117 million subs, including 110 million paid subs.
  • Two services emerged selling movie tickets via monthly subscription — a business model predicated on infrequent use. MoviePass, the New York-based service headed by Mitch Lowe, former CEO of Redbox, enables subs access to one theatrical movie per day for a $9.95 monthly fee, excluding 3D and in-theater dining. Cinemark, which operates nearly 6,000 screens in the United States and Latin America, launched Movie Club, an $8.99 service providing two monthly tickets. The service, unlike MoviePass, allows users to roll over unused tickets and grants a 20% discount on concessions.
  • Consulting firm Deloitte reported 2018 began with about 375 million SVOD subscribers worldwide — a tally projected to increase further as traditional pay-TV operators expand over-the-top video platforms.
  • Flixster Video shut down its website and discontinued all related operations in the United States. The site advised users to try other streaming video options such as Vudu.com and Movies Anywhere.
  • Sony Pictures Entertainment rebranded its ad-supported Crackle streaming service to Sony Crackle.
  • Hulu, the over-the-top video service co-owned by Disney, Comcast, Time Warner and Fox, ended 2017 with more than 17 million subscribers.
  • 4K Ultra HD Blu-ray emerged as a packaged-media star in 2017, Sony’s Victor Matsuda, chair of the Blu-ray Disc Association’s global promotions committee, told an industry gathering at CES 2018. “Hollywood really got behind the new format,” Matsuda said.
  • Warner’s It was the top selling DVD/Blu-ray for January, according to NPD VideoScan.

 

February

  • Sony Pictures placed Keith Le Goy, president of distribution for Sony Pictures Television, in charge of the home entertainment division, replacing Man Jit Singh, who held the position for four years.
  • Veteran entertainment executive Liz West, VP of global publicity at the Walt Disney Co., became EVP of marketing communications for international theatrical marketing and worldwide home entertainment at Paramount Pictures — a newly created position.
  • Amazon appointed Jennifer Salke to the position of president of Amazon Studios, replacing Roy Price, who resigned in 2017 following sexual harassment allegations. Salke, who headed NBC Universal since 2011, was responsible for development of current programming
  • Amdocs, a provider of solutions to communications and media companies, acquired Vubiquity, a provider of premium content services and technology solutions, in a $224 million deal.
  • Facing an underperforming film slate, Paramount Pictures jumped at the chance to offload sci-fi drama The Cloverfield Paradox to Netflix, Viacom CEO Bob Bakish told analysts on the media company’s fiscal call.
  • Subscription streaming video service HBO Now increased its subscriber base to 5 million, up from 2 million a year earlier.
  • Redbox filed litigation in U.S. District Court in Los Angeles against The Walt Disney Co., alleging the company’s direct-to-consumer streaming strategy aimed at blocking the kiosk vendor from reselling Disney’s packaged-media digital copy codes.
  • Theatrical ticket subscription service MoviePass topped more than 2 million subscribers, with CEO Mitch Lowe predicting 5 million subs by the end of the year.
  • Disney’s Coco was the top selling DVD/Blu-ray for February, according to NPD VideoScan.

 

March

  • Digital movie collection service Movies Anywhere added FandangoNow as its fifth digital retail partner, joining Amazon Prime Video, Google Play, iTunes and Vudu.
  • Walt Disney Parks and Resorts chairman Bob Chapek assumed additional responsibility for all of Disney’s consumer products operations globally, including licensing and Disney stores, as chairman of the new Parks, Experiences and Consumer Products business segment.
  • Carrie Dieterich, SVP of strategic initiatives at the Entertainment Merchants Association, announced her retirement after 24 years with the home entertainment trade association.
  • Netflix said it expects to generate $15 billion in user fees in 2018 — almost twice the $8 billion it will spend on original content co-founder/CEO Reed Hastings said at a corporate tech event in Los Angeles.
  • Amazon Prime Video generated 26 million viewers for 19 original programs in early 2017, including 5 million for top shows such as “The Man in the High Castle,” “Transparent,” “Mozart in the Jungle” and ‘The Grand Tour.”
  • Tower Records and Video founder Russ Solomon, one of the most important retail figures in the home video industry, died March 4 at age 92 of an apparent heart attack while watching the Academy Awards.
  • A TiVo survey of 3,000 consumers found usage of Redbox increased from 10% of respondents in the third quarter to 12.5% in the fourth in 2017.
  • Lucasfilm announced that Jon Favreau would executive produce and write a live-action “Star Wars” television series for the Walt Disney Company’s streaming video service, which is expected to bow in late 2019.
  • Indie distributor Shout! Factory partnered with China’s Ace Film HK Co. to acquire 91-year-old Roger Corman’s New Horizons Picture catalog of 270 movies and TV series. Known as “The Pope of Pop Cinema,” Corman is responsible for such titles as Death Race 2000, Piranha, Black Scorpion, Humanoids from the Deep and the 1960 Little Shop of Horrors, among others.
  • Amazon Studios closed an exclusive first-look deal with Oscar-winning filmmaker Kenneth Lonergan, who won an Academy Award for Best Original Screenplay and was nominated for Best Director for Manchester by the Sea, distributed by Amazon.
  • Billionaire entrepreneur Wayne Huizenga, who propelled Blockbuster Video into a national brand, among other businesses, died March 22 at age 80 following a long battle with cancer.
  • Netflix added a record 7.4 million new subscribers in the first quarter (ended March 31) — topping Wall Street estimates of 6.5 million. The service added 5.4 million subs internationally, compared with 1.96 million (1.45 million forecast) in the United States.
  • The first quarter of 2018 yielded positive results for studios due in part to top theatrical titles from the end of 2017 hitting retail channels.
  • Spurred by packaged-media and digital revenue from Oscar-winner La La Land, Power Rangers, Tyler Perry’s Boo 2! A Madea Halloween and Wonder, Lionsgate reported a $67 million increase in home entertainment revenue for fiscal year 2018, ended March 31.
  • Limited largely to catalog releases, MGM Studios Home Entertainment reported global revenue of $19.1 million for the quarter ended March 31, down 40% ($12.8 million) from revenue of $31.9 million for the previous-year period.
  • Disney’s Thor: Ragnarok was the top selling DVD/Blu-ray for March, according to NPD VideoScan.

 

April

  • Disney and subsidiaries Lucasfilm and Marvel Studios filed an amended claim in the U.S. District in Los Angeles alleging that Redbox is infringing copyright law selling digital codes to Disney movies obtained from the studios’ packaged-media releases.
  • Theatrical ticket subscription service MoviePass and corporate parent Helios and Matheson Analytics acquired movie information service Moviefone from Oath, a Verizon subsidiary that has taken an ownership stake in MoviePass and will continue to sell Moviefone’s digital ad inventory.
  • The Walt Disney Co. and Twitter announced an agreement to create live content and advertising opportunities across the entire Disney portfolio on the Twitter platform.
  • IHS Markit announced that global digital pay-TV subscriptions, including cable, satellite, telecom and online TV, exceeded 1 billion for the first time in 2017. The milestone comes despite ongoing growth of over-the-top (OTT) subscription video services such as Netflix, Hulu and Amazon Prime Video. SVOD services, which continue to add three subs for every new pay-TV sub.
  • Fox’s The Greatest Showman was the top selling DVD/Blu-ray for April, according to NPD VideoScan. Disney’s Star Wars: The Last Jedi takes over as the top seller for the year to date.

 

May

  • Warner Bros. promoted longtime executive Jim Wuthrich to president of worldwide home entertainment and games. He reports to Ron Sanders, president of worldwide theatrical distribution and home entertainment.
  • GameStop announced the appointment of Daniel DeMatteo as interim CEO following the sudden resignation of CEO Michael Mauler for personal reasons.
  • Netflix CCO Ted Sarandos told the MoffettNathanson Media & Communications Summit in New York that the service’s subscribers won’t miss Disney original movies, which are migrating to Disney’s pending direct-to-consumer service.
  • New research from Parks Associates showed that 6% of U.S. broadband households are likely to subscribe to an online TV service within the next 12 months, which would more than double the number of current subscribers.
  • Cinedigm partnered with Gatherer Entertainment, an entertainment hub dedicated to providing curated content to women in the 35-54 demo, with hopes of launching the first-ever women’s lifestyle subscription streaming video service.
  • Hulu, which announced it surpassed 20 million subscribers in the United States, signed a license deal with DreamWorks Animation, becoming the exclusive streaming home for future and catalog DWA movies starting in 2019.
  • Amazon announced it exceeded 100 million Prime members globally since launching the loyalty platform 13 years ago. Prime membership includes free access to Prime Video, among other services.
  • Mixed martial arts league UFC and The Walt Disney Co. announced a multiyear media rights agreement for 15 live UFC events to appear exclusively on new streaming service ESPN+, as well as across a variety of ESPN’s television, social and digital platforms, in English and Spanish.
  • Trans World Entertainment Corp. lost $8.1 million for the quarter ended May 5, which was 56% higher than the $5.2 million loss reported in the previous-year period. Revenue dropped nearly 5% to $96.6 million. The company cited much of the loss on continued challenges in its f.y.e. (For Your Entertainment) mall-based home entertainment retail chain.
  • Disney’s Black Panther was the top selling DVD/Blu-ray for May, according to NPD VideoScan.

June

  • A federal judge June 12 gave the green light to AT&T Inc.’s $85 billion acquisition of Time Warner Inc., rejecting a Department of Justice argument that such a union would stifle competition and hurt pay-TV consumers by costing them more money to stream movies and TV shows. Time Warner was subsequently renamed WarnerMedia and folded into the telecom’s media business segment headed by John Stankey. The deadline for completing the deal had already been extended to June 21, after originally being set for October 2017.
  • Looking to shake up its internal management structure, Hulu hired a new chief technology officer, its first chief data officer and realigned the subscription streaming video platform into four operating segments, among other changes. Notable in the reorganization was the departure of chief content officer Joe Stillerman and Tim Connolly, SVP of partnerships and distribution.
  • AT&T announced plans for its new AT&T Watch TV service, a package of Turner channels available for free to AT&T wireless subscribers and $15 on other platforms.
  • The Entertainment AIDS Alliance (EAA) changed its name to the Entertainment Aid Alliance to signify expansion into other charitable endeavors. The organization also added new leadership, including EAA president Jordan von Haslow, who took over the position in January from longtime president Sue Procko.
  • Sony Pictures Television revamped internal operations to combine networks, distribution and home entertainment into single business units operating under separate territorial management and reporting to Keith Le Goy, president of worldwide TV distribution at Sony Pictures Entertainment.
  • Redbox rolled out 4K Ultra HD Blu-ray rentals across more than 2,500 kiosks in six test markets: Los Angeles, Seattle, Austin, Detroit, Miami, and New York City. The UHD discs cost $2.50 per night, 50 cents higher than the rental rate for regular Blu-ray Discs (DVDs are $1.75).
  • In a potential blow to MoviePass, AMC Theatres bowed AMC Stubs A-List, which gives subscribers access to screenings and movie reservations at any AMC location in any format three times per week for $19.95 per month.
  • Parks Associates estimates the number of global households with an over-the-top video service subscription will exceed 265 million by 2022, spearheaded by Netflix and Amazon Prime Video.
  • The S&P Dow Jones Indices added Netflix to the S&P 100, replacing Monsanto. The subscription streaming pioneer with more than 125 million global subscribers recently saw its market value rival Comcast and Disney.
  • The U.S. Supreme Court ruled that states can levy a sales tax on e-commerce merchants regardless of a physical presence in the state, overturning a 1992 decision. The prohibition on taxing out-of-state e-commerce reportedly cost states $13.4 billion in revenue last year.
  • Former president Barack Obama and Michelle Obama entered into a multiyear agreement to produce films and series with Netflix, according to the streaming service. The Obamas have established Higher Ground Productions as the entity under which they will produce content for Netflix.
  • Apple signed a multiyear content partnership with Oprah Winfrey, “the esteemed producer, actress, talk show host, philanthropist and CEO of OWN,” the tech giant announced.
  • Seeking to significantly upgrade the Starz brand globally, corporate parent Lionsgate licensed the premium channel’s app to YouTube TV and Hulu.
  • The Walt Disney Co. shuffled executives and at the end of June shuttered animation division Disneytoon Studios, based in Glendale.
  • Digital continued to drive consumers to spend more money on home entertainment, with total spending up 9% for the first half of 2018 from the first six months of 2017, according to the quarterly update from DEG: The Digital Entertainment Group.
  • Lionsgate’s I Can Only Imagine was the top selling DVD/Blu-ray for June, according to NPD VideoScan.

 

July

  • Apple added longtime BBC Films executive Joe Oppenheimer to its international content development unit. Oppenheimer reports to Jay Hunt, the former BBC and Channel 4 executive Apple hired last October to head it international TV unit.
  • WarnerMedia CEO John Stankey told a company meeting that HBO has to increase “hours of engagement” in a consumer market he says is driven by portable devices that capture their attention “every 15 minutes.”
  • MoviePass parent company Helios and Matheson Analytics, after seeing its stock price drop to record lows below 20 cents per share, unveiled a series of financial moves intended to shore up the service’s loss-leader business model, which lets moviegoers see one non-premium movie a day for $9.95 monthly fee.
  • A new agreement with Warner Bros. gives Redbox rental kiosks access to the studio’s Blu-rays and DVDs on street date, rather than the week- and month- long delays of previous deals. The agreement also maintains new-release and catalog availability via Redbox On Demand at first release.
  • Verizon ended Go90, the ad-supported mobile-centric streaming video app launched in 2015 with much fanfare and hundreds of millions of dollars in investment.
  • Despite the popularity of Netflix, Amazon and Hulu, nearly half the country isn’t willing to pay for a video subscription streaming service, according to a new study from Parrot Analytics.
  • Streaming TV pioneer Roku introduced “Audience Marketplace,” allowing advertising buyers and sellers to more effectively target audiences on the Roku platform in the United States, according to the company.
  • Struggling toy chain Toys “R” Us — once a significant player in the DVD/Blu-ray Disc and video game sellthrough market — closed the last of its U.S. stores.
  • Adam Sandler and Jennifer Aniston, who teamed in Just Go With It, announce plans to reunite in Murder Mystery, due on Netflix in 2019.
  • A new agreement with Viacom gives Hulu exclusive streaming rights to series such as “Daria,” “Nathan for You,” “My Super Sweet 16” and “New Edition Story.”
  • Reese Witherspoon’s Hello Sunshine production company announces it is bowing two reality-based series on a branded channel via AT&T’s DirecTV Now and U-verse platforms.
  • Olympic Gold medalist Oscar de la Hoya’s Golden Boy Promotions signed a partnership with Facebook to bring ad-supported live boxing to the social media giant’s Watch streaming platform.
  • Subscription VOD service CBS All Access extended an agreement to stream all “NFL on CBS” telecasts through the 2022 season.
  • The Justice Department announced plans to appeal the federal court ruling giving the go-ahead to AT&T’s acquisition of Warner.
  • Warner’s Rampage was the top selling DVD/Blu-ray for July, according to NPD VideoScan.

 

August

  • Shareholders of The Walt Disney Co. and 21st Century Fox approved Disney’s acquisition of Fox’s entertainment assets, in a $71.3 billion exchange of stock and cash. The merger is expected to be completed in the first half of 2019.
  • Warner Bros. beta-launches “DC Universe,” a first-of-its-kind subscription streaming video service affording access to exclusive content and experiences “not available anywhere else.”
  • Heather Schuster, head of unscripted content at Amazon Studios, left the company after less than 12 months on the job, reportedly following an internal probe into her corporate behavior.
  • Netflix CFO David Wells announces plans to step down after helping the company choose his successor. The search will include both internal and external candidates. Wells joined Netflix in 2004 and has served as CFO since 2010.
  • Disney CEO Bob Iger announces the pending Disney streaming video service would focus on incorporating core brands, including Marvel, Star Wars and Pixar, in an effort to complement, and to a lesser extent, compete with services such as Netflix.
  • The Entertainment Merchants Association, MovieLabs and DEG: The Digital Entertainment Group formed the Digital Supply Chain Alliance to improve cooperation among the organizations’ members “in service of improved efficiency, standards adoption and the sharing of best practices.”
  • Microsoft Movies & TV became the sixth retail affiliate of the Movies Anywhere movie ownership rights locker service, allowing film fans to sync their Microsoft account to Movies Anywhere and centralize their digital movies purchased from Microsoft alongside those purchased from other connected retailers.
  • Netflix reportedly began testing streaming video ads of original content to select subscribers. The ads appear during binging sessions and other content viewing. Netflix said the house ads could be skipped and underscore the platform’s desire to expedite a user’s streaming experience with recommended content suggestions based on user data.
  • Sony Pictures Entertainment was reported to be looking for a fiscal partner to help it expand Crackle.com, the ad-supported streaming video service it acquired in 2006 for $65 million.
  • The NPD Group’s “Entertainment Trends in America” report is released, estimating that 17% of U.S. consumers relied solely on subscription video-on-demand services such as Netflix, Hulu and Amazon to view video content in the 12-month period ended March 2018, up from 11% in 2017. Meanwhile, 24% of consumers rely only on transactional methods — buying or purchasing content on physical discs or in digital formats, while 32% use a combination of transactions and SVOD.
  • Go90, Verizon’s short-lived attempt at over-the-top video targeting millennials on wireless devices, cost the company $997 million. The telecom revealed the pre-tax charges, which included $339 million in severance charges, in its quarterly fiscal results.
  • Former DreamWorks Animation CEO Jeffrey Katzenberg’s WndrCo holding company raised $1 billion in initial funding for “NewTV,” an app that aims to launch in 2019.
  • Shout! Factory formed a distribution partnership with Sesame Workshop for the “Sesame Street” home entertainment library.
  • Media measurement company Comscore announced it will bow a pilot program dubbed “campaign ratings” aimed at tracking audiences across linear TV and digital platforms with reliable audience demographics.
  • Cinedigm Entertainment Group renewed its home video distribution deal with the Crown Media Family Networks, parent company of the Hallmark Channel, Hallmark Movies & Mysteries, and Hallmark Movies Now.
  • Disney’s Avengers: Infinity War was the top selling DVD/Blu-ray for August, according to NPD VideoScan.

 

September

  • A federal judge granted the Walt Disney Co.’s request for a preliminary injunction against Redbox selling digital codes to Disney movies, ruling that Disney’s amended language accompanying its packaged-media combo packs sufficiently prohibits private parties from selling copyrighted content without permission.
  • Speaking at the Goldman Sachs 27th Annual Communacopia confab in New York, Bob Bakish, CEO of corporate parent Viacom, said Paramount is a very different place today — thanks in part to a trio of theatrical hits and increased television content production, among other initiatives.
  • WarnerMedia announced plans to launch an over-the-top video service featuring Warner Bros. and HBO catalog content, in addition to Turner Sports fare.
  • Helios and Matheson Analytics, corporate parent of fiscally challenged theatrical ticket subscription service MoviePass, sought to authorize a second reverse-stock split in another attempt to raise its stock price to meet the Nasdaq minimum of $1 per share.
  • Warner officially launches the DC Universe Sept. 15 — Batman Day — anchored by superhero series “Titans,” based on the Teen Titans comic book.
  • In a market increasingly dominated by subscription streaming, consumers still like to buy movies and TV shows on disc and digital formats, according to a report from Nielsen.
  • New consumer research from Leichtman Research Group found that 69% of all U.S. households have a subscription video-on-demand (SVOD) service from Netflix, Amazon Prime, and/ or Hulu — up from 52% in 2015. Among those that have an SVOD service, 63% have more than one of these services — up from 38% in 2015. Overall, 43% of U.S. households now have more than one SVOD service, an increase from 20% in 2015.
  • DEG: The Digital Entertainment Group announced the incoming board of directors for its 22nd year. Board officers, elected to a two-year term, include Comcast Cable’s Matt Strauss as chair; HBO’s Sofia Chang as vice chair, Paramount’s Bob Buchi as CFO, and Warner’s Jim Wuthrich as secretary.
  • BritBox, the 18-month-old subscription streaming video service launched in the U.S. by BBC Studios and ITV, topped 400,000 monthly subscribers and is projected to reach 500,000 members by next March, according to BBC Studios CEO Tim Davie.
  • Borrowing a page from its Amazon Channels, Amazon launched Storefronts — a platform giving Prime members access to more than 20,000 small and medium-sized retailers selling on Amazon. In 2017, more than 300,000 U.S.-based small and medium-sized businesses started selling through Amazon.
  • The FandangoNow on-demand video service began offering Binge Bundles, a rental initiative offering multiple titles from franchises in more than 100 themed collections.
  • Netflix added nearly 7 million global subscribers for the quarter ended Sept. 30, including 1 million in the United States — beating company projections and upping its global subscriber base to 137 million.
  • Cinedigm’s Docurama streaming services launched on the Roku Channel.
  • Streaming media device pioneer Roku lost $11.7 million in the quarter ended Sept. 30, widened from a loss of $7.9 million during the previous-year period. Revenue increased 39% to $173.4 million.
  • Paramount Home Media Distribution’s revenue of $157 million for the quarter ended Sept. 30 was down 17% from revenue of $190 million in the previous-year period. Domestic revenue from sales of physical and digital movies and TV shows reached $103 million, compared with $118.5 million last year. International sales totaled $54 million, down 22%. The studio attributed the drop in part to timing of releases and product mix. For the fiscal year, sales of physical and digital content topped $622 million, down about 27% from $849 million a year ago.
  • MGM Studios revenue was $21.8 million for the quarter ended Sept. 30, up 30% from the previous-year period. Television program home entertainment revenue increased 26% to $26.9 million.
  • Consumer spending on home entertainment in the third quarter of 2018 rose 15% compared with the prior-year period, to an estimated $5.7 billion according to DEG: The Digital Entertainment Group. For the first nine months of the year, spending was at nearly $17 billion, an 11% year-over-year gain.
  • Universal’s Jurassic World: Fallen Kingdom was the top selling DVD/Blu-ray for September, according to NPD VideoScan.

 

October

  • New data from Digital TV Research projected 1.877 billion combined global pay-TV and subscription streaming video subscribers by 2023 — up 37% from 1.372 billion at the end of 2017. SVOD subs will more than double, but traditional pay-TV will add just 94 million subs.
  • Walmart formed a strategic entertainment joint venture with Eko, a developer of interactive video technology. The initiative — dubbed W*E Interactive Ventures — expands Walmart’s entertainment ecosystem beyond its retail website, Vudu digital movie service and a new eBook platform.
  • After losing out to Disney for the purchase of Fox’s studio assets, Comcast emerged victorious in its efforts to gain control of U.K. satellite TV operator Sky. Comcast outbid 21st Century Fox with a $40 billion offer for outstanding Sky shares in an auction mandated by British regulators.
  • Redbox hired Chris Yates as GM for its Redbox On Demand digital video store, which launched in late 2017.
  • Lionsgate signed Ron Schwartz to a new long-term agreement as president of Lionsgate Worldwide Home Entertainment and promoted marketing executive Amanda Kozlowski to EVP of home entertainment and digital distribution marketing.
  • The Walt Disney Co.’s direct-to-consumer and international segment announced that subscription streaming video service ESPN+ surpassed 1 million paying subscribers since its April launch. The $4.99 monthly service ($49.99 per year) represents Disney’s first foray into branded standalone OTT video.
  • Roku resumed sales of its streaming media devices in Mexico following a favorable court ruling. Roku had been banned since the summer of 2017 after allegations its devices enabled third-party hackers to create apps to pirate content.
  • Satellite radio operator SiriusXM acquired streaming music operator Pandora Media in an all-stock transaction valued at about $3.5 billion. The transaction, which is expected to close in early 2019, creates the world’s largest audio entertainment company, with more than $7 billion in expected pro-forma revenue in 2018.
  • Sony Electronics announced a collaboration with software company Connekt to let owners of select Sony Smart TVs and Blu-ray Disc players buy products directly through the television.
  • Walmart-owned Vudu.com signed a deal with MGM Studios for original content to be made available on the transactional VOD platform’s ad-supported “Movies on Us” service. The deal includes exclusive North American access to original episodic series based on MGM intellectual property.
  • BBC Studios Los Angeles and Lionsgate Television signed a first-look agreement to co-develop original scripted content for the U.S. market based on the BBC catalog.
  • Lucasfilm begins production of “The Mandalorian,” the first “Star Wars” live-action series previously announced to be produced by Jon Favreau for Disney’s streaming service launching in 2019.
  • Disney’s Ant-Man and The Wasp was the top selling DVD/Blu-ray for October, according to NPD VideoScan.

 

November

  • Disney CEO Bob Iger said he wanted to expedite the home video window following the studio’s strong home entertainment results. “The home video window continues to be quite important to us,” Iger said. The pending Disney SVOD service is given a name, Disney+, and additional programming will include a second “Star Wars” series, based on Rogue One‘s Cassian Andor (played by Diego Luna), and a series based on Marvel’s Loki (played by Tom Hiddleston). Disney is also producing a live-action version of Lady and the Tramp for the service.
  • DEG: The Digital Entertainment Group presented its second annual Hedy Lamarr Award for Innovation in Entertainment Technology to Emblematic Group CEO Nonny de la Peña.
  • During the Nov. 6 4K Ultra HD Summit, DEG presented its inaugural Vanguard Award to Academy Award-nominated filmmaker Christopher Nolan .
  • Digital TV Research estimates revenue from subscription streaming video services such as Netflix and other over-the-top video services would top $35 billion this year — up nearly 30% from revenue of $25.04 billion in 2017.
  • Movies Anywhere celebrated its first birthday by touting its 6 million registered users, who have digital collections totaling 150 million movies, resulting in more than 1 billion minutes viewed. Fans have streamed more than 35 million movies on more than 100 different devices.
  • The board of directors of Helios and Matheson Analytics approved a plan to spin off subsidiary MoviePass, the fiscally-challenged movie ticket subscription service.
  • Online mega-retailer Amazon selected New York City and Arlington, Va., as the locations for the company’s new co-headquarters. Amazon announced expectations to invest $5 billion and create more than 50,000 jobs across the two locations.
  • With Netflix sitting atop the global SVOD market with 137 million subscribers, co-founder and CEO Reed Hastings reiterated that the platform going forward would focus on paid subscribers rather than including new subscribers engaged in free trial service, which equates to about 7 million fewer subs.
  • The FilmStruck streaming service from Turner Classic Movies catering to rare, classic, foreign, arthouse and independent cinema, shut down. The service launched in 2016 and was exclusive online streaming home of the Criterion Collection in the United States. Owner WarnerMedia also shuttered Korean-themed movie SVOD service DramaFever as part of efforts to consolidate its over-the top video strategy following its acquisition by AT&T. Criterion soon announced plans to start its own standalone streaming service in Spring 2019, which would also be available as an add-on to the pending WarnerMedia SVOD service.
  • AMC Networks completed the $59 million acquisition of all shares of common stock in home entertainment distributor RLJ Entertainment not owned by founder Robert L. Johnson. RLJE is now a privately-owned subsidiary of AMC Networks, with Johnson and his affiliates owning a 17% stake.
  • Reports indicate Apple is planning to launch an online TV service in more than 100 countries in the first half of 2019. The service would include original programming, in addition to third-party apps similar to Amazon Channels in the United States, Germany, Italy and the United Kingdom, according to com. Apple also announced Steve Carell would join Reese Witherspoon and Jennifer Aniston for its upcoming streaming service’s drama series about morning TV news.
  • Netflix, Amazon Prime and Hulu, in that order, topped Parks Associates list of the top 10 subscription over-the-top video services in the U.S. market. Rounding out the top 10 were, in order, HBO Now, Starz, MLB.TV, Showtime, CBS All Access, Sling TV and DirecTV Now.
  • Cinedigm added the martial arts platform Combat Go by JungoTV and the e-sports network Wham as linear offerings on the free, ad-supported Roku Channel. Both digital channels join Cinedigm networks The Dove Channel, CONtv and Docurama. Wham is also streaming on the Pluto TV service.
  • TV Studios, a subsidiary of Viacom’s MTV, partners with Facebook to reboot reality TV trailblazer “The Real World” for three new seasons debuting in spring 2019.
  • Cinedigm announced a partnership with Chinese streaming service Youku to distribute 30 original Chinese feature films in North America on all platforms including digital, DVD and Blu-ray, and OTT, with a primary focus on major streaming platforms and niche outlets.
  • Digital retailer Google Play Movies & TV will automatically upgrade customers’ past movie purchases to 4K when available from participating studios, even if they were originally bought in SD or HD. Google Play also announced a price drop for 4K movies.
  • Trans World Entertainment Corp., parent of f.y.e. (For Your Entertainment), had a net loss of $14 million for the quarter ended Nov. 3, compared with a net loss of $8 million a year ago. Revenue dipped $1 million to $90.8 million.
  • Consumer foot traffic to brick-and-mortar retail stores on Thanksgiving and Black Friday resulted in a combined 1% decline for the two-day period compared to last year, with a 1.7% decline in traffic on Black Friday versus 2017, according to new data from ShopperTrak.
  • Disney’s Incredibles 2 was the top selling DVD/Blu-ray for November, according to NPD VideoScan. In addition, Avengers: Infinity War moved into the top spot for the year-to-date top sellers, bumping Star Wars: The Last Jedi, which had held the spot for seven months. Disney titles topped the monthly chart six times and hold five spots in the yearly top 10.

 

December

  • Digital movie collection service Movies Anywhere added Comcast’s Xfinity Digital Store as its seventh digital retail partner and the first pay-TV provider to join.
  • The United States Court of Appeals for the District of Columbia Dec. 6 heard oral arguments in the Justice Department’s appeal of the AT&T/Time Warner merger. Justices expressed skepticism over the government’s concerns about the economic impacts of the merger.
  • With 70% of Netflix programming streamed through the TV, the service is seeking to turn more of its 130 million global subscribers toward using its mobile platform. The SVOD pioneer is testing lower-priced subscriptions for mobile users in select markets, including Asia.
  • Netflix topped global spending on original and licensed content with more than $12 billion in 2018. Following the mergers of Comcast/Sky and Disney/Fox, two of every five dollars spent on content in the United States will be spent by these four companies alone, according to new data from Ampere Analysis.
  • DirecTV announced plans to roll out a proprietary streaming media device in 2019 that would enable consumers to access online TV service DirecTV Now using their own broadband or high-speed Internet connectivity. The device, which would be similar to a Roku or Apple TV, would help DirecTV reduce subscriber acquisition costs typically associated with the installation of pay-TV service.
  • Cinedigm is launching Matchpoint, a managed-service technology platform that “enables content distributors, OTT service operators, Web publishers, and OEMs to efficiently and cost-effectively create compelling OTT and media subscription services.”
  • YouTube began offering catalog studio movies for free, including titles such as Legally Blonde, Rocky IV, Zookeeper and The Terminator, among others. The ad-supported streams appear alongside new releases promoted to buy or rent on YouTube.com and Google Play.
  • Still smarting from its $1 billion write-down of the short-lived Go90 video app, Verizon is embracing high-band 5G spectrum, which claims to offer wireless network speeds 100 times faster than the current 4G spectrum, by helping to market third-party over-the-top video services — similar to what Amazon Channels does.
  • Amazon Studios acquired rights to The Fighting Shirley Chisholm, with Oscar-winning actress Viola Davis set to co-produce and star in the title role as the first black woman elected to Congress. Chisholm served from 1969 to 1983. Separately, Amazon Studios reached an agreement with Jason Blum’s indie Blumhouse Television studio for eight darkly-themed feature-length thrillers to be released on Amazon Prime Video.
  • Hulu and Funimation, a subsidiary of Sony Pictures Television, announced a multiyear partnership and output deal to significantly expand Hulu’s anime collection beginning in 2019.
  • Amazon and Sinclair Broadcast Group are reportedly in early discussions about a joint bid to acquire the New York Yankees’ YES regional sports TV network.
  • Comcast Cable began enabling Xfinity X1 subscribers to stream 4K video content on a compatible HDTV in their home.
  • The Federal Trade Commission issued an alert to Netflix subscribers about an online phishing scam that attempts to extract personal information from unsuspecting subs, among other issues.
  • On the strength of live streaming three of the biggest sporting events in the world — Super Bowl LII, the PyeongChang Winter Olympics, and Spanish-language coverage of the FIFA World Cup  — NBC Sports Digital delivered its best year ever in 2018.
  • DC Universe, WarnerMedia’s superhero-centric subscription streaming video service, was made available on Amazon Fire TV.
  • AMC Theatres announced that its Stubs A-List subscription ticket service surpassed 600,000 subs since launching six months earlier. The nation’s largest theatrical chain had expected to reach 500,000 A-List members after 12 months.
  • The most popular shows on Netflix in the U.S. come from other companies, despite the online streaming giant’s push into original programming, according to a new report by online media company Recode.
  • Seeking to tap into apparent consumer demand for Spanish-language content from Spain in the United States, Spain’s public TV broadcaster, RTVE, is launching an over-the-top video service domestically, in Canada and Latin America.
  • Amazon announced a record-breaking holiday season, with more items ordered worldwide than ever before. The e-commerce behemoth said consumers shopped at record levels from a wide selection of products across every department. Best-selling products this season included all-new Echo Dot home speakers and Bose wireless headphones, among others.
  • Netflix is projected to pass Comcast-owned satellite pay-TV operator Sky in subscribers by the end of the year, according to new data from Ampere Analysis.

DEG, EMA and MovieLabs Release Updated Digital Supply Chain Specs

DEG: The Digital Entertainment Group, the Entertainment Merchants Association and Motion Pictures Laboratories (MovieLabs), together with member studios, retailers, and service providers, have approved and released four updated supply chain specifications for digital distribution of film and TV.

The specifications were developed and reviewed jointly by the three organizations through the Digital Supply Chain Alliance announced earlier this year. The new updates are designed to expand support for international distribution to ensure all territories receive the right content and facilitate more sophisticated business engagement and improved automation among participants in the digital supply chain.

The updated documents include two comprehensive specifications developed over many years and two more targeted specifications for “core” requirements and use cases. The core specs enable content owners and distributors to start small with a simpler initial deployment, then grow the implementation as needed to meet requirements.

“The Digital Supply Chain Alliance was created to allow us as an industry to move faster and more efficiently towards standards adoption industrywide,” said John Powers, executive director, DEG, in a statement. “We are happy to demonstrate, with the release of these first specs, that this is successfully happening. This is a meaningful step in keeping up with the pace of change in digital distribution.”

“As our members continue to expand the scope and scale of their content offerings, it’s important that our specifications adapt to support them,” said Eric Hanson, VP of industry leadership, EMA, in a statement. “It’s been great having such engaged support from retailers, service providers, studios and TV networks in agreeing on technical solutions to increasingly complex use cases.”

“Working together with the DEG and EMA, we incorporated improvements into the specifications to make them complete enough and robust enough to handle a wide range of situations encountered by our members,” said Craig Seidel, MovieLabs VP of distribution technology, in a statement. “We are very pleased to make these the first specs approved through the Digital Supply Chain Alliance.”

The updates include:

• Common Metadata 2.7 — New features have been added to the Common Metadata specification, including support for franchises and brands, related works, more sophisticated TV internationalization, and technical metadata improvements (e.g., dynamic metadata and additional encoding parameters). The new spec also includes general updates such as new codec-controlled vocabularies, minor corrections and clarifications.
• Media Entertainment Core 2.8 — The Media Entertainment Core Metadata spec defines the core requirements for transferring metadata from publishers to retailers. MEC has been updated to conform to Common Metadata 2.7.
• Media Manifest 1.8 — The Media Manifest spec has also been updated to follow Common Metadata 2.7, as well as adding data to support additional workflow use cases, ability to handle cards in playable sequence, and improved support for TV that reduces the need for territory-specific experiences.
• Media Manifest Core 2.0 — Media Manifest Core 2.0 is the targeted core specification based on Media Manifest 1.8 and Common Metadata 2.7. It includes all the improvements from those specifications and adds full support for episodic content.

The latest specifications can be found on the MovieLabs website www.movielabs.com/md.