Advent of HDTV, Broadband VOD Platform, Compelling Economics Will Drive
Studios to Show Films First in the Home Before Theatrical Release
Home Debut Could Generate First-Day Revenues of $200 Million per Film Within
BOSTON, April 15 /PRNewswire/ -- Starz Encore Group Chairman, Founder, and
CEO John J. Sie today predicted that movies will regularly premiere on cable
and satellite, rather than in theaters within the next ten years.
Sie told the Harvard Business School Media Conference that the widespread
adoption of high definition television sets by consumers and ubiquitous
deployment of VOD platforms enable millions of Americans to have a
theater-like experience in their homes, and that the economics of the movie
business will drive studios to make use of this audience to debut their films.
"Last year, the theatrical screenings of films generated about $5 billion
in revenue for the studios," Sie told members at the conference, "compared
with $4 billion from cable and satellite. Clearly we are rapidly approaching
the tipping point where it will make more sense for studios to release their
films first on cable and satellite, and later in the theaters."
Releasing a film on satellite and cable can save millions in distribution
costs, Sie pointed out. "And the economics are irresistible." Sie noted that
there are about 5 million HD capable sets in the United States today. In the
next decade, that figure will likely rise to 50 million or about 50% of US
"If a major studio can debut a film at a price of $19.95 (about what it
costs two people to go to the theater) and attract 20% of HD homes to watch,
that would generate $200 million in revenue on the opening day, a blockbuster
number in anybody's book," he said.
Sie did not forecast the demise of the movie theater. "Millions of
Americans still love the experience of getting out of the house and going to a
theater and always will," he said. "But in the future, big films will debut
in the home and create the buzz for their theatrical releases, rather than the
other way around."
Sie, a 30-year veteran of the cable and satellite business, has played a
key role in many television breakthroughs, including two-way cable, the
packaging of multiple premium networks, the digital standard for High
Definition Television, and multiplexed thematic premium television channels.
Starz is the largest provider of premium movie services in the United
States with approximately 151 million pay units. Starz offerings include the
Starz Super Pak(R), with up to 13 digital movie channels and more than
750 movies per month, Starz On Demand(R), the only on-demand pay TV
subscription service available on cable, satellite, and broadband platforms,
and a suite of advanced video offerings, including STARZ! HD(SM), Encore
HD(SM), and Starz On Demand HD(SM). Starz is a wholly-owned subsidiary of
Liberty Media Corporation (NYSE: L, LMCb), http://www.starz.com.
For further information, please contact Tom Southwick of Starz,
+1-720-852-5821, or cell, +1-303-513-3758, firstname.lastname@example.org.
Web Site: http://www.starz.com