What kind of incentive did Paramount and now Warner receive? - High-Def Digest Forums
View Poll Results: What kind of incentive did Paramount and now Warner receive?
Cash incentive (80% or more of the total package) 3 21.43%
Cost incentive: replication, disk manufacture etc.. (80% or more of the total package) 8 57.14%
Patent incentive (80% or more of the total package) 0 0%
Other 3 21.43%
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  #1  
Old 01-05-2008, 07:35 AM
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Default What kind of incentive did Paramount and now Warner receive?

What kind of incentive did Paramount and now Warner receive?

1. Cash incentive (80% or more of the total package)
2. Cost incentive: replication, disk manufacture etc.. (80% or more of the total package)
3. Patent incentive (80% or more of the total package)
4. Other

Opps. Forgot advertising incentive. Though I doubt Paramount got something like $120 mil out of $150 mil in 'advertising incentive.' I would guess mostly from cost incentive.

For example, 5-10% off replication/manufacture cost. If this save the studio 10 cent per disk, imagine the saving over 10 years period.

10 cent saving per disk x 200 mil disks per year x 10 years = $200 mil total.

Last edited by Dust; 01-05-2008 at 07:46 AM.
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Old 01-05-2008, 07:53 AM
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Were they paid?

http://formatwarcentral.com/index.ph...-from-the-bda/
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Old 01-05-2008, 08:04 AM
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Quote:
Originally Posted by Sonic67 View Post
In business, incentives are given everyday.

10% discount this, 5% discount that.

It's normal that manufacturer (HD DVD CEs and Blu-Ray CEs) give some kind of incentive to their vendor/supplier/customer (movie studios).

Paramount: $150 mil worth of incentives for 18 months
Warner: ??? mil worth of incentives for several years

I am guessing at least $300 mil worth of incentives in the form of 'cost incentive' i.e. lower manufacturing cost of the disks.
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Old 01-05-2008, 08:08 AM
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Thats a hell of an incentive for Warner.
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Old 01-05-2008, 08:14 AM
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Quote:
Originally Posted by J3ST3R View Post
Thats a hell of an incentive for Warner.
These kind of incentive, you have to spread them over a period of several years (i.e. the lifetime of the technology).

Let's assume maybe 10 years until something new take over. Though I am guessing it will last a lot longer since I don't see downloading high def to take off anytime soon. HECK, look at music. Legal download only account for around 20% of total music sales. And a song = 3-5 MB. A high def movie = 50 GB.

So $300 mil over 10 years is only $30 mil a year.

$30 mil a year to end the format war is a bargain.
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Old 01-05-2008, 08:16 AM
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Quote:
Originally Posted by Dust View Post
I am guessing at least $300 mil worth of incentives in the form of 'cost incentive' i.e. lower manufacturing cost of the disks.
So what you are saying is your are just making shit up to try to make yourself feel better about HD-DVD taking a dirtnap today...
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Old 01-05-2008, 08:19 AM
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Originally Posted by VU0 View Post
So what you are saying is your are just making shit up to try to make yourself feel better about HD-DVD taking a dirtnap today...
If you believe that $150 mil worth of incentives for Paramount is true, then it is safe to assume that Warner got much more especially knowing how important Warner is.

Paramount: $150 mil worth of incentives for 18 months exclusivity
Warner: XXX mil worth of incentives for several years exclusivity

My educated guess: XXX = $300 mil.
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Old 01-05-2008, 08:20 AM
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Quote:
Originally Posted by Dust View Post
If you believe that $150 mil worth of incentives for Paramount is true, then it is safe to assume that Warner got much more especially knowing how important Warner is.

Paramount: $150 mil worth of incentives for 18 months exclusivity
Warner: XXX mil worth of incentives for several years exclusivity

My educated guess: XXX = $300 mil.
Whatever.

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Old 01-05-2008, 08:43 AM
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Default For HD....

I beleive they got some incentives and a little money. Even though it has the added benefit of possibly ending the format war, thus giving HD media a better chance of survival. I don't believe that they did it for that sole reason. I am still a little upset. Not at the formats, but at the studios. They should have forced a compromise at the very begining. They held all of the cards out of the gate. You can't sell movie disk with no movies. Well, I guess I can go ahead and buy Rush Hour 3 now. I think the traffic here will be getting a little slim in the coming months. I would hope that it says busy enough to complain about any shortcomings on new releases and hardware.
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Old 01-05-2008, 09:11 AM
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Quote:
Originally Posted by Dust View Post
If you believe that $150 mil worth of incentives for Paramount is true, then it is safe to assume that Warner got much more especially knowing how important Warner is.

Paramount: $150 mil worth of incentives for 18 months exclusivity
Warner: XXX mil worth of incentives for several years exclusivity

My educated guess: XXX = $300 mil.
The format war was killing DVDs. Standard Definition DVD sales were down because of the Format War. Ending the war was incentive enough.
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