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First it was Time (NYSE: TWX) Warner’s Jeff Bewkes last week, then Fox Filmed Entertainment’s Peter Levinsohn yesterday. Today’s high-powered entertainment executive sweating the implementation of premium VOD: DreamWorks Studios CEO Stacey Snider.
She indicated DreamWorks’ film distribution partnership with Disney (NYSE: DIS), a conglomerate that doesn’t have a presence in the multichannel distribution business, isn’t exactly an incentive to rush into charging $30 to see a film at home a few months after its theatrical debut.
“The pressure is on to figure out (premium) VOD even if you wish it was something that didn’t happen,” she said Tuesday at the Future of Film Summit in Los Angeles.
Companies like Comcast (NSDQ: CMCSA), soon to be owner of Universal Pictures, and Time Warner, may have a stronger urge to make premium VOD happen because it adds value to cable subscriptions. But Snider indicated that DreamWorks can’t allow those companies to set the terms of trade for this new window or risk not being able to set the pricing they feel their films could attract.
What Snider does like about where she sits is DreamWorks’ ties to Disney give her access to executives who are moving aggressively to embrace new media. Which leaves the challenge of replacing the revenues lost with the irreversible decline of DVD sales. “That’s what we’re grappling with,” she said. “How can we create a transaction that’s a higher margin, where people want to buy something because there’s something valuable about ownership.”
Premium VOD is going to be a very tricky proposition for every studio, aligned with a cable company or not, but they know they’re going to have to confront this.