Lionsgate sees boom in high-def DVD; huge growth in download revenue

A key union demand in the negotiations between writers and producers now begun in Hollywood is to raise the percentage of DVD revenue that goes to labor. Since the days of videotape and betamax (!) only 20% of the total revenue generated by the distribution of DVDs is subject to collective bargaining. The Writers Guild is demanding that that amount be raised to 40%. While some have argued that DVD revenue is softening as internet based distribution systems come online, there is still a lot of life in the DVD environment as Lionsgate, for example, sees it. In fact, it could take a decade or more for the new online/mobile distribution world to take hold and in the meantime DVDs will still be a money maker for the industry. In 2000 for example Vodafone bragged that its 150 billion takeover of German giant Mannesmann was justified because of the impending roll out of 3G phones – but they are still not here!

Also note that the Lionsgate research report predicts an 8 fold increase in internet down load revenue (granted, from a relatively low starting point)! And yet the producers have proposed to “study” the issue for three years! This report indicates two things: there is money being made and to be made from digital downloads AND there is real data available now.

Lionsgate sees boom in high-def DVD