Universal: Let's Stamp Out $1 Movie Rentals

The Journal has a great piece today about Universal's campaign against Redbox, a company that operates 12,000 DVD rental kiosks in the US.

The basic issue is that while consumers love renting movies from the kiosks for $1, Universal feels that, A, the kiosks threaten important partners like Blockbuster Video, and, B, don't cut Universal in on a share of the rental revenue. (They just purchase the DVD, and that's it.)

From Sarah McBride's story:

Blockbuster, which must rent and staff stores, might charge as much as $4.99 for the same rental. Last week, Blockbuster said it was testing renting some classic movies for 99 cents, because of factors such as the poor economy. It is also rolling out DVD kiosks of its own, starting with about 50 kiosks during the next few weeks at various retail locations such as convenience stores.

Big retailers such as Blockbuster typically give studios a portion of rental revenue on top of purchasing the DVDs they rent out. But Redbox doesn't cut the studios in on rentals.

...In addition, studios claim that stuffing DVDs in kiosks may cheapen the underlying product. "The studios have been worried about the Redbox model from day one," says Tom Adams, president of Adams Media Research. As a studio, "Why would I help you build a business that charges a dollar for a product I'm trying to sell for $20?"

So let's recap: New technologies that make movies more accessible and affordable to consumers... Hollywood still hates 'em.

Studios Court Mr. Skin

- I found this story in today's NY Times fascinating: studios actually send screeners of new movies to the Web site MrSkin.com, to promote new releases that have nudity in them. From the story:

“The movie companies aren’t stupid,” [CEO Jim] McBride said. “I’m a guest on radio shows at least 300 times a year as the expert on celebrity nudity in film. If I’m on the radio talking about a movie like ‘Ask the Dust,’ and telling guys, ‘You’ve got to check it out: Salma Hayek has a full-frontal at the 33-minute mark,’ it’s going to make guys want to rent or buy the movie.”

More than 75 movie companies — including Universal, Fox, Paramount and Lionsgate — regularly send advance DVDs to Mr. McBride’s company. And his subscribers buy hundreds of DVDs every day, said Brian Sokel, director of marketing at TLAvideo.com, which sells DVDs on the site. (He declined to provide precise figures.)

Mr. Sokel finds nothing untoward about selling a film solely on nudity.

“That’s why filmmakers and Hollywood put sex scenes in movies — because it sells,” Mr. Sokel said. “People have a problem with raw or open sexuality, but for our company and for Mr. Skin, it doesn’t have to be a demonized concept. This is normal; you’re not a freak for wanting to see a Hollywood star in a film be naked.”

I wonder if the actresses in those scenes find this kind of niche marketing a little unseemly...

- The Times also has a piece about a new area on The Daily Reel that's intended to be a place for content creators and companies that need content to mingle.