Time Warner CFO: Windows Up Home Entertainment Margins 15% - High-Def Digest Forums
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Old 03-03-2011, 11:37 AM
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Default Time Warner CFO: Windows Up Home Entertainment Margins 15%

I would not have guessed that the window would boost revenue by 15%. You would think we would see some of that in the sell-through numbers.

And the double margins for digital versus physical are astounding.

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Warner Home Video’s trendsetting windows erected around new-release movies offered to Netflix and kiosks (notably Redbox) has helped the studio realize a 15% margin lift compared with titles not embargoed at least 28 days from street date, according to parent Time Warner CFO John Martin.

Martin, who was speaking March 2 at a Morgan Stanley technology, media and telecom conference in San Francisco, said the studio is trying to drive consumer transition from physical media to electronic sellthrough or rental through pricing and windows.

“For us, digital transactions are better than physical transactions,” Martin said.

Indeed, Warner Home Video was the first studio to offer new-release titles on transactional video-on-demand the same day as DVD and Blu-ray Disc. Martin said the decision is based simply on margins, which he said are typically double for digital distribution than physical.
http://www.homemediamagazine.com/ren...rgins-15-23230
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Old 03-03-2011, 12:01 PM
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I would not have guessed that the window would boost revenue by 15%. You would think we would see some of that in the sell-through numbers.
The report does not say that..

They didn't say that it boosted total revenue just the margins on sales. It is entirely possible to have a lower volume of sales with higher margins and still have the same or even lower overall revenue from a product.
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Old 03-03-2011, 12:03 PM
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And the double margins for digital versus physical are astounding.
What is so astounding? No physical product + lower quality bitstream = lower costs.

Great for them, terrible for the consumer.
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Old 03-03-2011, 03:03 PM
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What is so astounding? No physical product + lower quality bitstream = lower costs.

Great for them, terrible for the consumer.
I don't see anyone complaining except a few guys here. My customers love Netflix on their big screen TVs. So do I! Does Bluray offer a better picture? Of course it does. But the difference only matters to a minority of consumers.
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Old 03-03-2011, 03:06 PM
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I don't see anyone complaining except a few guys here. My customers love Netflix on their big screen TVs. So do I! Does Bluray offer a better picture? Of course it does. But the difference only matters to a minority of consumers.
I don't know who your customers are, but apparently they only watch the HD offerings. People I know, who aren't into home theater and do not care about the best quality out there still cannot bring themselves to watch standard definition netflix movies/shows on their lcd's or plasmas. They may look great on a crt, but I don't know anyone that still has one left unfortunately.
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Old 03-03-2011, 04:24 PM
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So why no comments from Universal or Fox? They too are using the 28 delay.
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