"Alice" sparks debate over quick DVD releases

Hollywood studios and theaters in disagreement about how to optimize movie sales

Published March 16, 2010 5:16PM (EDT)

Disney's plan to quickly release the blockbuster "Alice in Wonderland" on DVD is sparking new heat in a debate between Hollywood studios and movie theaters over how quickly films move from the big screen to people's living rooms.

Moviegoers will have the option of watching "Alice" at home in about three months, worrying some theater owners who fear that narrowing the gap between theatrical runs and DVD debuts will undermine ticket sales as some fans skip the cinema and wait for the DVD.

"A robust, exclusive theatrical window remains vital for the health of cinemas and the movie industry as a whole," John Fithian, president of the National Association of Theatre Owners, told members in a speech Tuesday at their annual ShoWest convention.

Studios like short windows between theatrical and DVD releases because it speeds up their cash flow and allows them to pull in DVD business while films are fresh in audiences' minds. Longer lags for DVDs also leave more time for movie pirates to sell counterfeit copies.

The issue is a key topic this week at ShoWest, where studios trot out stars, films and footage to promote upcoming releases.

The time window between theatrical and home-video releases gradually shrank as studios cashed in on booming DVD sales starting in the late 1990s. The average gap between big-screen and DVD releases has held steady at about four months in recent years.

Now, cinema operators worry other studios might follow Disney's lead, though the head of Sony Pictures assured theater owners that Hollywood is not aiming to squeeze them out in favor of DVD revenues.

"Showing films in theaters is what makes a movie a movie. It's what makes stars stars. It's what makes films famous. It's what makes the public perk up and pay attention," said Michael Lynton, Sony chairman and chief executive officer, in the ShoWest keynote address Monday.

Theater owners and studio executives say they are open to flexibility on DVD release patterns for some movies if it benefits both sides. Cinemas always beg Hollywood to release big movies in typically slow months at theaters rather than bunching up top hits during the busy seasons.

"You always have the issue of lots of movies coming in the summer, lots of movies coming in the holiday period, and so our members have been talking to distributors about getting movies into late winter, like 'Alice,' trying to get movies into September. Places where we typically don't have great movies," Fithian told reporters Tuesday.

But putting a potential blockbuster in theaters in September might mean shortening the time until the DVD release to three months or less so the film can be in stores for Christmas, which Fithian said theater owners are open to discussing.

The huge business Tim Burton and Johnny Depp's "Alice in Wonderland" did over normally slow March weekends might ease theater owners' worries. "Alice in Wonderland" shot past $200 million domestically and $400 million worldwide after just two weekends.

With audiences now watching movies and other entertainment on portable devices such as laptop computers and cell phones, studios need to experiment with release patterns for new technology without undermining big-screen business, Sony chief Lynton said.

"We do not want to open a new window in a way that closes yours," Lynton told theater owners.

By David Germain

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Alice In Wonderland