NATO Bites Back Over Early VOD: We Won’t Calm Down

After Jeff Bewkes and Les Moonves say the threat of shorter windows has been overstated, John Fithian begs to differ

Jeff Bewkes may pooh-pooh the dangers of shorter theatrical release windows, but theater owners are still fighting mad.

After the Time-Warner CEO played down concerns over early video-on-demand (VOD) at the Jefferies Global Technology, Internet, Media & Telecommunications Conference on Wednesday, the National Association of Theater Owners not so respectfully disagreed.

Also read: Jeff Bewkes — Premium VOD Is Much Ado About Nada

"Forgive us if we decline to take business lessons from the end of the industry that enabled the erosion of value in the home market," said NATO President and CEO John Fithian said in a statement.

The controversy over a new DirecTV program that allows customers to watch new releases for $30 some 60 days after they premiere in theaters, has led to a bitter standoff between studios and theater owners. Theater owners say the new program will cannibalize the box office.

Appearing alongside Bewkes at the mogul confab, CBS President and CEO Les Moonves said he heard these concerns, but maintained that theater owners would have to accept shorter releases in order to help stabilize an industry that is being hobbled by cratering home entertainment sales.

Fithian begged to differ. Noting that theatrical box office has grown 25 percent globally over the last five years, he went on to imply that theater owners were being punished unfairly by studios in their effort to retroactively prop up the price of DVDs and Blu-rays. The NATO head said that kiosk rentals and subscription services are responsible for undercutting the sell-through business, not a longer theatrical window.

During the conference, Bewkes said that premium VOD would help curb movie piracy, but Fithian also tried to poke holes in that logic by noting that by releasing movies in pristine condition earlier, studios were improving pirates' access to the latest releases.

"Studio bosses should spend more time talking to their partners about models that might work, instead of asking us to calm down," Fithian said.