A double-digit decline in DVD sales over the past six months presents a “significant” challenge to film industry revenues, Sony Entertainment CEO Michael Lynton said.
Appearing at a keynote talk at TheGrill 2016, Lynton said that tanking returns on home entertainment has the industry warily looking at risky release models — like the Sean Parker concept the Screening Room, which created a firestorm earlier this year among the establishment.
“We do have to figure out a way to make up for the hole in the boat that the decline in the DVD business has shown,” Lynton told TheWrap’s CEO Sharon Waxman in conversation at the Montage Beverly Hills. “It is definitely down double digits of late … it is significant.”
“It’s not over, you’d be surprised. They still do drive a lot of revenue, but they certainly do not drive the revenue that they did,” Lynton continued.
Lynton admitted that emerging technology platforms have always rescued the industry’s existing business model — whether it be pay TV, DVDs themselves or the digital download market — and it’s time to take more risk in platform releasing.
“In terms of people going to movie theaters, that’s a habit that will be persistent. The fate of the theatrical business in this country is not that of the DVD business,” Lynton said.
“The problem with day-and-date right now is that it’s a pretty fragile ecosystem. You have a bunch of people who are habituated to go to the movie theater and a group of individuals who overlap and say, ‘OK, I’m also going to be able to buy this in my home in three months.'”
Parker’s Screening Room service would offer movies on the same day as their theatrical release for a steep at-home-viewing fee of $50, which Parker contends would be shared with studios and theaters.
“I haven’t spoken to them in over six months,” Lynton said of Parker. “But we do need to figure out another revenue stream long term. Typically the industry responds when either there’s a crisis, the economic model is threatened, or because suddenly somebody offers a big pile of cash on the other side. Right now, neither of those things are happening.”
Check back for more from TheGrill’s keynote with Lynton.
The Scene at TheGrill 2016: TheWrap's Media Leadership Conference (Photos)
TheWrap's seventh annual media, tech and entertainment conference TheGrill kicks off at the Montage Beverly Hills.
IMAX Entertainment's CEO Greg Foster speaks on the future of moviegoing in theaters, online and overseas.
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Adam Aron, CEO of AMC Entertainment Holdings, joins IMAX Entertainment CEO Greg Foster and STX Entertainment Motion Picture Group Chairman Adam Fogelson to discuss the future of moviegoing.
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Adam Fogelson, Chairman of STX Entertainment Motion Picture Group, Adam Aron, CEO of AMC Entertainment Holdings, and Greg Foster, CEO of IMAX Entertainment, speak with TheWrap's Thom Geier.
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Will Palmer, co-founder and CEO of Movio, and Luke Xiang, Vice President of Beijing Weying Technology speak to TheWrap's Matt Pressberg about online movie ticketing in China.
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Media and guests at the Montage Beverly Hills for TheGrill 2016.
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President and General Manager of BBC America, Sarah Barnett discusses the state of TV.
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David Nevins, the CEO of Showtime Networks, Sarah Barnett, the President and General Manager of BBC America, and John Landgraf, the CEO of FX Networks and FX Productions, join TheWrap's Scott Collins to discuss the state of TV.
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John Landgraf, CEO of FX Networks and FX Productions, speaks during TheWrap's 7th Annual TheGrill at Montage Beverly Hills.
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Guests enjoy the Virtual Reality Open Demos at TheWrap's 7th Annual TheGrill at Montage Beverly Hills.
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Lawyer Nina Shaw, partner at Del Shaw Moonves Tanaka Finkelstein and Lezcano, discusses dealmaking in the digital age.
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Schuyler Moore, partner at Stroock and Stroock and Lavan LLP, joins Nina Shaw on stage to speak on deal making in the digital age.
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Bonnie Eskenazi, Entertainment Partner at Greenberg Glusker Fields Claman and Machtinger LLP, and Susan Zuckerman Williams, Partner at Loeb and Loeb, also speak on dealmaking in the digital age.
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Sharon Waxman speaks with Rafi and Benny Fine during lunch TheWrap's 7th Annual TheGrill at the Montage in Beverly Hills.
Andy Howard, partner at Shamrock Capital Advisors, Carlos Jimenez, Managing Partner at Moelis and Company, Andrew Siegel, Executive Vice President at Advance Publications, and Dan Schechter, Managing Director L.E.K Consulting, discuss "What Lies Beyond the $4 Billion Media M&A Move."
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Aric Ackerman, COO of The Cavalry Productions, and Brenda Robinson, partner at Greenburg Glusker, at lunch during TheWrap's 7th Annual TheGrill at the Montage in Beverly Hills.
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VoteBlast's Ardy Falaki speaks during TheWrap's 7th Annual TheGrill at the Montage in Beverly Hills.
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Van Toffler, CEO of Gunpowder & Sky, and Charlie Corwin, CEO of Endemol Shine, speak to Sharon Waxman about the magic of story development.
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Instagram star Chantel Jeffries speaks during the Innovators Panel at TheWrap's 7th Annual TheGrill at the Montage in Beverly Hills.
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Rob Goldberg, CEO and founder of Fresno Inc, speaks at the Innovators Panel.
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Tim Staples, CEO of Shareability, Mark Popkiewicz CEO of Mirriad, internet personality Chantel Jeffries, Mike Hopkins, CEO of Hulu, Rob Goldberg, CEO and founder of Fresno Inc. all speak at the Innovators Panel.
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Entertainment, media and technology converge at TheWrap’s seventh annual Grill Conference at the Montage Beverly Hills
TheWrap's seventh annual media, tech and entertainment conference TheGrill kicks off at the Montage Beverly Hills.