Lionsgate adds Xenon, Hit in one week

Studio looks to boost sales to families, Latinos

By Danny King -- Video Business, 3/27/2008

MARCH 27 | Lionsgate this week announced exclusive distribution agreements with both U.K. publisher Hit Entertainment and urban film producer Xenon Pictures in an effort to boost demand in the children’s and Latino genres.

Lionsgate acquired the rights to distribute more than 300 Xenon titles, including DVDs of shows produced by Grupo Televisa, Mexico’s largest broadcaster, the companies said. Earlier this week, Lionsgate said it would in May become the exclusive North American DVD distributor for Hit, whose well-known children’s franchises include Barney, Bob the Builder and Thomas & Friends.

The agreements will help Lionsgate boost its total DVD sales, which fell in the quarter ended Dec. 31, as Bratz and Skinwalkers failed to match revenue from late 2006 releases Akeelah and the Bee and An American Haunting, the company said last month.

The agreement with Hit, which had “well over $100 million” in U.S. DVD sales last year, will boost Lionsgate’s North American family home entertainment market share to 15%, from 9%, said Lionsgate president Steve Beeks. He declined to disclose Xenon’s domestic DVD sales.

“We’ve put our stake in the ground and intend to be a very big player in the Latino production and distribution business,” said Beeks. “It is going to be a big business sometime in the next four to five years.”

Lionsgate replaces 20th Century Fox Home Entertainment as Hit’s distributor. Lionsgate, which also secured digital distribution rights for Hit titles, will distribute Hit’s first feature-length, direct-to-DVD Thomas title in three years, the Pierce Brosnan-narrated Thomas and the Great Discovery, in September.

With the Hit agreement, Lionsgate’s North American family DVD market share will be on par with Paramount Home Entertainment and Warner Home Video, though it trails Walt Disney Home Entertainment, according to Lionsgate. Beeks said he hopes to increase Hit DVD sales on new titles from the Shawn the Sheep and Pingu brands.

The studio will take over most of the Xenon titles that had been distributed by Universal Music’s Vivendi Entertainment.

In December, Lionsgate became the exclusive U.S. distributor of MGA’s Bratz DVDs and video-on-demand and electronics titles, expanding on a more limited theatrical and DVD output deal that began in 2006. Lionsgate also releases on DVD Scholastic’s Clifford the Big Red Dog, American Greetings’ The Care Bears, Cookie Jar Entertainment’s The Doodlebops, Nelvana’s Miss Spider’s Sunny Patch Friends as well as Speed Racer and the Marvel Animated Features series.

Founded in 1986 by former stand-up comedian Leigh Savidge, Xenon started out specializing in urban film production and distribution before expanding into the Latino market through a 2002 distribution agreement with Televisa.