My friend Ed just bought a new 65″, Blu-Ray, Internet ready TV for under $1000. I can’t say I’m not jealous. But I see my prediction coming true before my eyes. A while back I wrote that if large screen, hi-def TV’s become that affordable the consumers will clamor for VOD…no…. actually they will demand Premium Video on Demand. James Cameron and the other mega tent-pole filmmakers decry this development (http://tinyurl.com/end-of-movie-houses). No more half Billion budgets for YOU!
I recall a similar phenomenon that took place back in the 80’s-90’s when the music industry’s business model was flattened by iTunes™ and Napster. Unbeknownst to most fans of film, the theatrical ‘window” is a loss-leader. It takes a minimum, minimum I say, of $25 Million to advertise, promote and supply the prints (at $1000-$2000 each) for a new film. The recent film Super 8 was released on 5000 screens. Do the math…….can you say 5 Mil on the low side? Television spots for film trailers, poster on sides of buses, print advertising, PR , etc. Hoo boy. The Theatrical Release window is where the filmmakers and producers hope and pray they get big box office numbers and positive WOM (Word of Mouth). The belief is that big box office receipts somehow tells the subsequent window audiences, “this movie did well, maybe I should rent it when it comes out on DVD”. And Oh, how much advertising must they do to get asses in the seats? At least $20 million worth of buys. So budgets get bigger. Stars who can get an ass in a chair demand more money and the bubble continues to grow.