Major Hollywood studios are seriously considering releasing movies for rental in homes just weeks after they debut in theaters, for as little as $30. It’s a sign that the movie industry is continuing to adapt to the homeward shift in viewing habits. If adopted, the move could have important implications for Apple, which has been pushing for greater flexibility about online rental releases from its end for months now.
Late last year, a report surfaced in Bloomberg that Apple had entered into negotiations with studios for rights to home-video rentals of the latest movies while they are still playing in theaters, though a concrete agreement has yet to emerge. For their part, 21st Century Fox Inc., Warner Bros., and Universal Pictures have also reportedly been considering iTunes as a potential streaming platform, especially as theater revenues stagnate.
There are a number of possibilities being batted around among at least six of the seven largest Hollywood studios, who are open to the idea as a way of bolstering their home entertainment revenues, which have steadily declined due to piracy and flagging demand for DVDs. Younger viewers, having grown accustomed to services like Netflix and Hulu, are also markedly less patient and unwilling to wait months on end to watch one film.
However, studios and major exhibitors like AMC, Regal Cinemas, and Cineplex are still divided on what the details of an early rental program should be. According to Variety, Warner Bros. CEO Kevin Tsujihara opened with a proposal to open films for rental 17 days after they debut for $50. Fox and Universal, on the other hand, pushed for a lower rental price with a later release date.
Eventually, Fox and Warner Bros landed on the possibility of making the home viewing option available between 30 and 45 days after opening for $30 a rental. Universal is reportedly holding out for faster release timetable, within four weeks of a movie’s theatrical debut. Variety notes that online rentals typically become available 90 days after debut for less than $10– cheaper than the average movie ticket. An accelerated release schedule would have the added benefit of cutting down on marketing costs, as studios wouldn’t have to launch a second advertising campaign to re-introduce rentals to consumers months after their original release dates.
Other major studios like Lionsgate, Paramount, and Sony are also said to be engaged in discussions with major theater chains, who have obvious concerns about streaming releases eating into their box office returns or erasing them altogether.
While the negotiations are very much up in the air, pending the resolution of a number of complex issues, Apple sees a clear advantage in shorter rental windows for its iTunes business, particularly in light of competition from the likes of Google and Vudu. Getting major studios to elect iTunes as a rental outlet for recent releases would help the platform stand out in an already-crowded streaming market.
Apple recently released iTunes 12.6 which does away with frustrating restrictions on viewing rented content. Now, iTunes will allow users to view rented movies on multiple screens at the same time– regardless of whether it’s attached to an iPhone, iPad, or Apple TV.