Is FOX Going to Charge you $25 for an HD Movie?

Would you be willing to spend $25 to watch a high definition movie at home, 60 days after it's released? FOX is hoping so. According to The Hollywood Reporter:

News Corp. is betting that people will pay $25-$30 to watch Fox films at home in high-definition quality via cable and satellite TV 60 days after their theatrical release.
Speaking during the second day of the annual Bear Stearns Media Conference in Palm Beach, Fla., in a session available via webcast, News Corp. president and chief operating officer Peter Chernin said Tuesday the conglomerate has been "talking to the cable operators and satellite operators about the idea of a 60-day, high-priced high-def rental" offer costing $25-$30.

He later repeated the $25 price range as a possible model in a hint that this could be closer to the final price point but didn't specify what kind of revenue split was likely for the HD-to-home product.

The logic behind the pricing seems to be:

Sources also said Tuesday that the HD window would target consumption by families and groups. For example, consumers could get some friends together, have food and drinks and enjoy a home premiere, one source suggested. With movie tickets in New York costing well above $10, the pricing actually could be attractive to high-end users, another industry observer suggested.

The final logic sounds okay if you consider the costs of taking a family to the movies. But here's a possible conspiracy theory for you. To come out and say $25 a movie with no context scares the crap out of consumers. So before you think Mr. Chernin is insane, imagine what happens when this news of his $25 a movie hits the streets . Consumers will rebel against the concept and this will ultimately damage the plans of smaller companies that are trying to cash in on the early release of movies to TV concept. If you turn off consumers to the concept now, you can rid yourself of the competition. Then FOX can come in a few months later with a revamped plan that isn't so radical, endearing themselves to consumers without the nagging competition. Now I'm not saying that's what's happening, but it wouldn't be the first time we've seen things like this happen in Hollywood.

At HollywoodReporter.com [via TVPredictions.com]

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March 3, 2006

Is FOX Going to Charge you $25 for an HD Movie?