Warner Bros.’ Record Box Office Drives WarnerMedia’s Banner 2018

Spurred by Warner Bros.’ record $5.5 billion global box office, WarnerMedia generated more than $9.2 billion in revenue in 2018 — up nearly 7% from revenue of $8.6 billion when the company operated as Time Warner prior to the closing of AT&T’s $85 billion acquisition.

The media company comprising Warner Bros., HBO, Turner and Otter Media, posted Q4 operating income of $2.7 billion; and $5.69 billion for the year.

The company said it generated $564 million in fourth-quarter (ended Dec. 31, 2018) revenue from the sales of video games and home entertainment, which was down nearly 15% from revenue of $682 million in the previous-year period. For the year, revenue dropped nearly 45% to $1.08 billion from $1.93 billion in 2017.

Sales of packaged media and digital from movies and TV shows topped $1.56 billion and $416 million, respectively, in the previous-year quarter under Time Warner. WarnerMedia does not breakout home video revenue.

In 2018, Warner Bros. theatrical revenue was driven led by Ready Player One and the fourth-quarter releases Fantastic Beasts: The Crimes of Grindelwald and Aquaman, the latter grossing nearly $1.1 billion at the global box office to date.

Warner Q4 revenue topped $4.5 billion and included revenue of $2.1 billion from theatrical product, $1.8 billion from television product and $564 million from video games and home entertainment. Operating expenses totaled $3.7 billion, and the operating income margin was 18.1%.

HBO revenue in the quarter reached $1.7 billion and included $1.4 billion of subscription and $259 million of content and other revenue. Operating expenses totaled $1.1 billion and the operating income margin was 37.2%.

Turner Q4 revenue reached $3.2 billion, compared to $107 million in the fourth quarter of 2017. Revenue during the quarter included $1.8 billion of subscription revenue, $1.1 billion of advertising and $219 million of content and other revenues. Operating expenses totaled $1.9 billion, compared to $59 million in the fourth quarter of 2017. Turner’s operating income margin was 40.2% compared to 44.9% in the year-ago quarter.

The increases were predominantly due to the June 2018 acquisition of Time Warner.

 

‘Night School,’ ‘Venom’ Top Redbox Charts

It was a split decision at Redbox the week ended Dec. 30.

Universal Pictures’ Night School, a comedy starring Kevin Hart that earned $77.3 million in North American theaters, debuted at No. 1 on the Redbox kiosk chart, which tracks DVD and Blu-ray Disc rentals at the company’s more than 40,000 red vending machines.

Sony Pictures’ Venom, a superhero film based on the Marvel Comics character of the same name, remained on top of the Redbox On Demand chart for the second consecutive week. The Redbox On Demand chart tracks transactional video-on-demand (TVOD), both electronic sellthrough (EST) and transactional streaming.

Night School debuted at No. 2 on the Redbox On Demand chart. In the film, a successful salesman (Hart) sees his life turned around after getting fired for accidentally destroying his workplace. Forced to attend night school so he can finally get his GED and find another job, he soon finds himself amongst a group of misfit students, a teacher with no patience for class clowns (Tiffany Haddish) and his high school nemesis-turned-principal (Taran Killam) who will strive to make sure he fails the course.

Venom, with a domestic gross of $213 million 2018’s No. 10 movie, slipped to No. 2 on the Redbox disc-rental chart its second week in kiosks.

The Predator, from 20th Century Fox, debuted at No. 3 on the Redbox kiosk chart while slipping to No. 7 from No. 6 the prior week on the Redbox On Demand chart.

Rounding out the top five on the Redbox disc-rental chart were the Sony Pictures revenge thriller The Equalizer 2 at No. 4, down from No. 3 the prior week, and Universal Pictures’ The House With a Clock in its Walls at No. 5. The latter, a family fantasy about a young boy who is sent to live with his uncle in a spooky old house, had debuted at No. 2 the previous week.

Another new release, Sony Pictures’ White Boy Rick, debuted at No. 7 on the kiosk chart. The film, a biographical crime drama about the youngest-ever FBI informant, earned $24 million in theaters after debuting at the Telluride Film Festival.

On the Redbox On Demand digital chart, Lionsgate’s A Simple Favor, a black comedy about a vlogger who tries to solve the disappearance of her rich and mysterious best friend, slipped to No. 3 after bowing at No. 2 the prior week.

The Equalizer 2 finished the week at No. 4 followed at No. 5 by The House With a Clock in its Walls. Both films slipped a spot from the prior week.

White Boy Rick came in at No. 6 on the Redbox On Demand digital chart.

 

Top DVD and Blu-ray Disc Rentals, Redbox Kiosks, Week Ending December 30

  1. Night School (new)
  2. Venom
  3. The Predator (new)
  4. The Equalizer 2
  5. The House With a Clock in its Walls
  6. Smallfoot
  7. White Boy Rick (new)
  8. Peppermint
  9. A Simple Favor
  10. Mission: Impossible – Fallout

 

Top Digital, Redbox On Demand, Week Ending December 30

  1. Venom
  2. Night School
  3. A Simple Favor
  4. The Equalizer 2
  5. The House With a Clock in its Walls
  6. White Boy Rick
  7. Peppermint
  8. The Predator
  9. Mission: Impossible – Fallout
  10. Smallfoot

 

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Disney’s Bob Iger Wants to Expedite Home Video Window

Following strong Q4 home entertainment and theatrical results, Walt Disney CEO Bob Iger said he has no plans to downsize the theatrical window as it relates to Disney movies transferring earlier to the company’s pending over-the-top video service, Disney+.

The same restraint, however, cannot be said about retail channels, including DVD, Blu-ray Disc and electronic sellthrough.

Speaking Nov. 8 on the fiscal call, Iger said that with the studio generating a record $3 billion in operating revenue – up 27% from a record $2.3 billion in the previous-year period – shortening the traditional 90-day window would only dampen revenue (and anger exhibitors).

Indeed, studio revenue reached nearly $10 billion in the fiscal year, up 19% from $8.4 billion last year.

“With us, if it ain’t broke … ,” quipped Iger, in response to an analyst’s question whether OTT video platform Disney+ afforded the studio opportunities to give consumers earlier streaming access to branded movies in the home.

Iger said Disney would continue fight to maintain the traditional theatrical window, which has been under (now measured) attack by Netflix.

“We have a studio that is doing extremely well and a [release window] formula that is serving us really well in terms of its bottom line,” he said.

Interestingly, Iger gave a shout out to home entertainment – his first in years – which he said continued to deliver strong retail results for digital and physical content. In fact, the executive said there is ongoing internal strategy about putting theatrical content into retail channels sooner.

“The home video window continues to be quite important to us,” said Iger. “You’ll likely see us protect that as well, although there’s going to be discussion around whether there’s an opportunity to move product into that window maybe a little sooner.”

Iger quickly clarified Disney was not looking to encroach – at the moment – upon the theatrical window.

Disney is ending a record year in home entertainment with five of the top-six selling DVD/Blu-ray Disc titles, including Black Panther, Star Wars: The Last Jedi, Coco, Thor: Ragnarok, Avengers: Infinity War, and just-released, Solo: A Star Wars Story. The titles — excluding Solo — have generated nearly $400 million in combined revenue since their release.

Lionsgate Promotes Kapouranis to President of International TV and Digital Distribution

Lionsgate has promoted Agapy Kapouranis to president of international television and digital distribution.

She will report to Lionsgate president of worldwide television and digital distribution Jim Packer.

She succeeds Lionsgate veteran Peter Iacono, who has decided to leave the studio to become CEO of TravelCadabra.

During her seven years with the company, Kapouranis has structured a broad range of complex global and regional licensing deals encompassing the company’s films and television series, including alternative programming formats and Starz original programming, to a broad range of digital and linear platforms around the world.

She has broad experience in the subscription video-on-demand (SVOD), electronic sellthrough (EST) and transactional video-on-demand (TVOD) space, according to a Liongate release.

“Having an executive with experience in all forms of global distribution such as Agapy gives Lionsgate an advantage as we continue to navigate a dynamic and fast-changing environment with our growing and evolving portfolio of content,” Packer said in a statement. “She is the ideal executive to carry Peter’s leadership of our international team into the future. Peter is a great international sales and marketing executive who has helped lead the charge as we’ve built a robust network of digital and linear relationships around the world. We wish him the very best in his entrepreneurial endeavors.”

Kapouranis joined Lionsgate in 2011. She first served as SVP of television and digital distribution and was based in Paris for four years. In that capacity, she closed global digital EST deals with Apple, Xbox, Playstation and Google. She was later promoted to EVP of worldwide subscription video on demand, the position she held until her latest promotion.

Iacono has been part of the worldwide television and distribution group leadership team for nearly 10 years, leading all international distribution, acquisitions, sales and marketing for Lionsgate’s television and catalog feature slate. He recently spearheaded the company’s new Latin American first-run pay television deal with Amazon Prime.

“It’s been a pleasure working with an innovative studio like Lionsgate for going on a decade where I’ve been fortunate to be surrounded by one of the best international sales and distribution teams in the business,” said Iacono in a statement. “It is time for a new adventure where I will be CEO of TravelCadabra an internet travel, entertainment and e-commerce platform launching in early 2019 for which we have been fortunate enough to secure up to $10 million in initial funding.  It gives me great pleasure to pass the stewardship of Lionsgate brilliant international distribution team to such a talented and dynamic executive as Agapy as I venture on this entrepreneurial path.”

Lionsgate Signs Ron Schwartz to New Agreement as President of Worldwide Home Entertainment

Lionsgate has signed Ron Schwartz to a new long-term agreement as president of Lionsgate Worldwide Home Entertainment.

Schwartz will oversee the company’s nearly $1 billion-a-year worldwide home entertainment operations, including the domestic and international home entertainment sales of Lionsgate’s feature film slate, its television businesses, a nearly 17,000-title film and television library, and the slate of Starz programming.

Additionally, he assumes the expanded responsibility for the company’s home entertainment digital transactional business.

“Reflecting the studio’s ‘Lionsgate 360’ approach, he will work closely with Lionsgate president of Worldwide Television & Digital Distribution Jim Packer on all home entertainment initiatives,” according to a Lionsgate press release.

Schwartz will continue to shepherd Lionsgate’s $400 million-a-year multiplatform releasing and specialty acquisitions business, including titles for the company’s Grindstone Entertainment and Premiere labels, sister company Roadside Attractions and third-party partners.

“In today’s fast-changing environment, we’re always looking for ways to connect our artists and content with consumers across an ever-expanding array of platforms,” said Lionsgate Motion Picture Group chairman Joe Drake. “Ron’s great talent relationships, business acumen and strategic vision have helped position Lionsgate as a global home entertainment powerhouse and an innovator in the media space.”

Schwartz served as president and GM of Lionsgate Home Entertainment Sales & Distribution before being promoted to head the company’s worldwide home entertainment group in 2014. Prior to that, he served as EVP and GM of Lionsgate’s home entertainment operations, playing an instrumental role in the company’s adoption of ground-breaking entertainment technologies and formats, according to the release.

Schwartz joined Lionsgate through the company’s merger with Trimark in 2000 and was inducted into the Variety Home Entertainment & Digital Hall of Fame in 2015.

Thriller ‘Leave Yourself Alone’ Due on Digital and VOD Oct. 9 From Virgil

The cinema verite thriller Leave Yourself Alone comes to Digital HD and VOD Oct. 9 from Virgil Films & Entertainment.

The feature debut by Nicole Eckenroad is the story of a young tormented Hollywood actress followed by a pair of documentary filmmakers as she loses control of herself in method acting. In May 2006, a 19-year-old Hollywood actress moves to Philadelphia to escape her bad reputation and restart her acting career. The documentary filmmakers follow her to an undefined end as she experiments with Meisner technique, taking on the characteristics and behaviors of the characters she plays more often than her own. After losing countless roles to A-list talent, Nicole commits recklessly to a leading role in a story too close to her own and spirals into the abyss of her darkest secret, depicting the lasting effect of a sexual assault.

In 2015, Eckenroad was selected by Kathy Schulman, Stephanie Meyer, and Lionsgate to direct one of their seven original Twilight shorts, The Groundskeeper. She was honored at the Crystal and Lucy Awards as a Voice of the Future, and the film was presented at the ArcLight Hollywood followed by a Q&A with Stephanie Meyer. She is currently in development on her second feature, Shade.

Watch the trailer for Leave Yourself Alone here.

Panel: Digital Movie Sales Need Added Value, More Promotion

Digital sales are growing, but not enough to grow the overall ownership pie, and more needs to be done to boost the market, panelists noted Sept. 26 at the Digital Media Pipeline ’18 summit in Los Angeles.

(L-R): Fandango’s Chad Ludwig, Vubiquity’s Craig Heiting and Lionsgate’s Adam Frank.

“We need to do a better job of growing ownership,” said Adam Frank, SVP, worldwide digital sales and distribution, Lionsgate, during the “Issues in Digital Retailing” panel at the summit presented by the Entertainment Merchants Association.

Digital sales now represent 41% of the overall sellthrough market, and at the end of 2017, it was about 31%, which is good news, he noted. Still, the overall sellthrough pie needs to expand, rather than shrink.

Adding value to the digital buy is one way to entice customers, panelists said.

“We have a value proposition problem on the EST side,” said Chad Ludwig, head of brand marketing at Fandango.

As far as bonus content, like the additional scenes during the end credits of movies, “Why not hold that back for EST only?” he suggested.

Bundling of content, such as the dynamic bundling on Walmart’s Vudu, is another potential value add, Frank said.

Bonus features should be more integrated into the movie where you can click on something and get bonus features while watching, said Craig Heiting, EVP of sales at Vubiquity.

“I think that bonus content is very good,” he said. “It’s how you find it.… You need to make it available for the digital age.”

Thomas K. Arnold

Bonus content should be “dynamically added into the feature,” Frank agreed.

More targeted marketing is another tactic that could boost digital buying.

Fandango targets buys at the most enthusiastic consumers, Ludwig said.

Timing is also important.

“Ask people after they saw the movie if they’d like to buy it,” suggested Heiting, rather than asking them to make that commitment before watching it digitally.

Frank said the industry needs to let consumers know that they are buying something they can’t get on a streaming service by telling them, “Hey, this title is not available for SVOD [subscription video-on-demand].”

He also said studios need to try to get transactional purchase offerings on non-transactional platforms, such as DirecTV Now and Sling.

“You need to fish where the fish are,” he said, mentioning the younger audience in particular is moving to digital platforms.

Some platforms do a good job at integrating transactional buys, Frank said.

“Amazon is a great example,” he said. “We’ve seen an incredible amount of transactions coming from that platform.”

Hulu would be a logical platform to integrate transactional buys, considering its studio ownership, he noted.

Digital ownership also has a name problem, panelists said. Electronic sellthrough (EST, “It sounds like you’re going to get an x-ray or something,” Heiting said.), transactional video-on-demand (TVOD) and Digital HD are among the many awkward terms that have been used to describe buying a digital copy, noted moderator Thomas K. Arnold, publisher and editorial director of Media Play News.

“Digital locker is really what it is,” Heiting said. “It’s not marketed well.”

The digital locker Movies Anywhere is a good description of digital ownership, noted panelists, but it too needs to up marketing.

Its first big mission was to “alleviate any friction” in purchasing movies and storing them in the cloud, but education is the next big mission for the service, Fandango’s Ludwig said. FandangoNow joined the retailer lineup for the service in March.

‘The Great Escape’ Tribute Documentary ‘The Coolest Guy Movie Ever’ Available Now From Virgil Films

The Coolest Guy Movie Ever, a tribute to the John Sturges classic The Great Escape, is available now on DVD ($14.99), EST and VOD from Virgil Films.

The documentary follows hardcore fans that return to the locations where the film was made, revealing little known facts about The Great Escape, which starred Steve McQueen, James Garner, Richard Attenborough, Charles Bronson and James Coburn.

Narrated by an actor in the film, Lawrence Montaigne, The Coolest Guy Movie Ever celebrates the 55th anniversary of the theatrical release of The Great Escape.

British Home Entertainment Eyes Bullish Half-Year Sales

The British Association for Screen Entertainment said more than 38 million copies of movies and TV shows sold in the first six months of 2018, including 21% and 5% increases, respectively, in digital and disc sales of the Top 10 releases.

New releases represented 44% of sales in the world’s No. 2 home entertainment market, up 3% from the previous-year period.

Through the first-half of the year, digital retail represented 22.4% of revenue, up 6.9% from the previous-year period. Average consumer spending on digital transactions increased to £31.50 ($41.19).

Blu-ray Disc sales represented 12.9% of revenue – up 0.7% — with 4K UHD now representing 12% of the Blu-ray market. DVD generated 64.7% of sales, down from 72.3% last year.

“Whether you consider the performance of the top [sellers], the rise in digital transactions or the increased consumer spend on high-definition Blu-ray and 4K UHD titles, there is much to suggest that being able to access a film in your home … remains important to many,” Liz Bales, CEO at BASE, said in a statement.

Twentieth Century Fox Home Entertainment’s The Greatest Showman ended the period as the top-selling title, with 1.4 million units sold. The movie is also Britain’s all-time fastest-selling digital release, with more than 500,000 units sold since May.

Robert Price, managing director at Fox Home Entertainment in the U.K., said there was much to be positive about the home entertainment sector thus far in 2018, especially in the context of a challenging trading environment and unsteady consumer confidence.

“As an industry we must ensure our relevance to audiences sustains,” Price said. “We need to capitalize on successes where we see them and be bold and collaborative in approaching challenges and meeting the needs of a customer base still clearly very much in love with ownership and collection.”

Other top-selling digital releases included Justice League (Warner Home Entertainment) with more than 170,000 digital copies sold; Universal Pictures Home Entertainment’s Fifty Shades Freed (120,000 units), and Sony Pictures Home Entertainment’s Blade Runner 2049 from (112,000 digital copies).

Walt Disney Studios Home Entertainment’s Star Wars VII – The Last Jedi sold more than 1.03 million copies across all formats, and StudioCanal’s marmalade-eating bear found a home with more than 835,000 families with Paddington 2 (released by Warner in the United States)

Sony’s Jumanji: Welcome to the Jungle sold more than 600,000 units since its release in April. Disney/Marvel’s Black Panther sold 513,000 units.

 

HBO to Bow ‘The Tale’ on Digital Download July 2

The Tale, starring Laura Dern, will be available for digital download on July 2 from HBO Home Entertainment.

Based on winning writer and director Jennifer Fox’s own childhood, The Tale follows Jennifer (Dern) as she faces life-altering questions after a short story she wrote for school at age 13 forces her to re-examine her first sexual relationship. The film premiered at the Sundance Film Festival.

The Tale also stars Isabelle Nélisse, Elizabeth Debicki, Jason Ritter, Frances Conroy, John Heard, with Common and Ellen Burstyn.