Sony to revenue-share Blu-ray through Rentrak
By Jennifer Netherby -- Video Business, 7/16/2007
JULY 16 | Sony Pictures Home Entertainment will offer revenue sharing on Blu-ray Disc releases through Rentrak Corp., marking the distributor’s first high-def sharing deal.
Beginning in September, Sony will make all of its new releases and select catalog titles on Blu-ray available under the agreement, which expands the studio's DVD revenue-sharing deal with Rentrak. Neither Sony nor Rentrak would disclose terms of the deal.
“We think it’s important to the expansion of the format to make sure that the rental component of the Blu-ray launch is covered, and now it is,” SPHE president David Bishop said. “Virtually all retailers can have Blu-ray on a revenue-sharing basis. We think it’s important to the retailer, so they are perceived as being on the cutting edge of new technology.”
Marty Graham, president of Rentrak’s pay per transaction division, said the deal could accelerate high-def adoption because more rental retailers are likely to enter the business earlier in the format’s lifecycle.
“In terms of the financial impact [to Rentrak], it’s minimal, because we’re in the beginning stages of the rollout of high-definition and Blu-ray discs in the market,” he said. “It’s more strategic. What we’re doing with this Blu-ray program, we’re enabling retailers to stock Blu-ray discs much earlier in the adoption phase than they would if [they] had to acquire on a wholesale basis.”
Graham said the distributor is in talks with other studios to add high-def revenue sharing.
Rental makes up less than 10% of Blu-ray revenue, but Bishop believes that by offering it on revenue-sharing terms, rental retailers might bring in more copies than they would otherwise, giving the format a bigger presence at retail.
The deal comes about a month after Blockbuster announced it would expand Blu-ray only to 1,450 stores.
Industry observers have speculated that some Blu-ray studios signed revenue-sharing deals with Blockbuster as part of the move. Blockbuster wouldn’t comment at press time on possible revenue-sharing deals.
Bishop declined to comment on whether Sony has a revenue-sharing deal with Blockbuster for Blu-ray.
