M+E Daily

Release Windows: What Are The First Four Weeks Worth?

How great a percentage of revenue do the first 28 days of a DVD or Blu-ray title’s release represent? That’s the key question facing studios as well as companies such as Netflix, Redbox, and Blockbuster, as the home entertainment industry struggles to rebalance its sell-through and rental revenue streams.

Ralph Schackart, an analyst at William Blair & Co., relies on a long-held estimate that more than 75% of a title’s earnings potential is generated within the first 28 days of its release (via Home Media Magazine). Going on that figure, Schackart says studios have little choice but to window all of their major new releases — which would negatively impact the likes of Redbox.

Yet for Blockbuster, which is playing up its 28-day advantage over Redbox and Netflix for certain films in its advertising, the window would seem to represent less of an opportunity. “According to Blockbuster’s own research, “approximately more than 60% of business for new releases is done in the first 30 days,” CEO Jim Keyes told FastCompany in June.

Sure, it’s a general rule of thumb, and individual titles may continue to vary against the average. But the disparity between the estimates — not to mention the precipitous decline in retail disc sales — points to the fact that formulas must be continually verified against market realities.

With studios continuing to hold divergent views on the effectiveness of exclusive release windows, the outcome of the issue is far from certain.