‘Early electronic sell-through’, as studios continue to experiment with new release windows

Interesting piece in Variety on growing studio use of digital selling of films ahead of the DVD/Blu-Ray release, as Hollywood and indies continue to try to negotiate the increasingly uncertain relationship between the various post-theatrical windows – probably the biggest issue currently facing all parts of the film business.

The latest example, Iron Man 3, is to be available for high-definition download purchase (as opposed to rental) three weeks in advance of its release on disc or digital rental/VOD, a practice that’s been dubbed ‘early electronic sell-through’ (EST) and that is reported to be becoming the rule rather than the exception for blockbusters. The aim of this particular strategy, Variety suggests, is to encourage a move into the sphere of digital ownership by those who have been buyers of discs, to maintain this lucrative sector of the market in the face of declining disc sales (sales that remain a very important part of the overall studio economy). The risk, it seems, is that a general move towards the digital is seen as threatening a loss of sales in general to the sphere of rentals (download, VOD, etc), in which margins are lower.

iron man 3 poster

Be interesting to see how this works – whether digital ownership really has the same appeal as its physical equivalent as far as film is concerned. Is this different from the way the same transition has worked for music, I wonder? Will as many people buy digital copies for keeps in the same way that they buy music that’s perhaps more likely to be listened to repeatedly (not that everyone pays for music that way either, any more, what with the advent of subscription-based channels such as Spotify)?  There probably aren’t any simple answers to such questions, but they’re going to be crucial to the future shape of this part of the business.

Not surprising, then, that the studios are experimenting with different strategies of these kinds. One of the most notable points made in this article is that all but one of the studios (Disney) have changed their operational structures, combining previously separate digital and disc divisions in order to encourage a more integrated approach rather than having them compete against one another. This suggests that they are, as usually rather belatedly, seeking to get their act together, to come to terms with changes in broader media usage in the era of broadband internet. Historically, the studios have tended to be slow to adapt in such ways, and much remains yet to be sorted in this instance, including which will be the most effective/popular and user-friendly (not to mention, appropriately priced) channels through which to access movies online other than via the temptations of high-def illegal download.

Smaller indies have so far been far more prone to innovation, if only because they have less of a stake in the prevailing system and so much less to lose and more to gain. Will we end up with a new system that’s more or less consistent across the spectrum, I wonder, as has broadly been the case in the past as far as the relationship between theatrical and various forms of post-theatrical distribution has been concerned? Maybe, but it’s equally possible that we’re heading for a more diverse landscape that’s likely to be as full of challenges all around as it is of opportunities.

This entry was posted in Industry practice. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *

Powered by WP Hashcash