You may or may not be aware that companies like Netflix currently have to wait 28 days after a DVD is released before it can be offered for streaming video, in order to give DVDs a chance to sell in stores.
That timeline is set to double to 56 days, thanks to a new deal between Time Warner’s movie studio and services like Netflix, Redbox, and Blockbuster. That’s right – it will be nearly two months before some new releases make it to video rental stores and sites.
This unfortunate change, which, once again, reflects how out of touch Hollywood is with the evolution of media consumption, has been enacted to increase DVD sales, which dropped 17 percent in 2011. A 56 day wait before Warner Bros. movies (which is set to release titles like The Hobbit, The Great Gatsby, and The Dark Night Rises in 2012) may increase DVD sales, but it will also increase piracy from consumers desperate to see movies but unwilling to pay DVD prices.
Warner Bros. 56 day deal isn’t the first one the company has made. In 2010, the movie studio signed a deal with Netflix and Coinstar’s Redbox that caused them to wait the initial 28 days before DVDs were released for renting. Netflix and Redbox later signed deals with other big studios, making the 28 day wait period an industry standard.
At the time, the deal allowed Netflix to purchase DVDs at a significantly reduced rate, but with this new doubled wait period offers no further benefit to the site. Previously, Blockbuster was not subjected to the same wait period, but even Blockbuster customers will now be unable to rent Warner Bros. DVDs when they are released.
It stands to reason that Warner Bros. must have put significant pressure on the three DVD-rental companies, because this is sure to have a negative effect on business. Netflix is already struggling after raising its prices, losing Starz, and more recently, losing direct access to HBO shows, and now it’s going to have even fewer new releases?
This seems like a bad deal for all parties involved. If a 28 day window wasn’t sufficient to increase DVD sales, why would a 56 day wait work any better? This initiative isn’t going to sell more movies, but it will impact Netflix’s already poor consumer image. It won’t help Redbox, who is already flagging in customer opinion after recent price hikes, and it certainly won’t help Blockbuster, a failing company that’s going to lose its only edge.
The new deal between Warner Bros. and the DVD rental companies is set to be announced at CES next week in Las Vegas. Reps for all companies involved have declined to comment.