Playboy stops DVD production

Moves content to online sales

By Susanne Ault -- Video Business, 10/17/2008

OCT. 17 | Playboy Enterprises is shuttering its DVD production business as part of a larger restructuring to reduce costs.

The company wants to shave expenses by $10 million in order to return to profitability in 2009, Playboy chair and CEO Christie Hefner said in an Oct. 15 note to staff. In addition to exiting the disc business, Playboy will eliminate 80 employee positions as well as consolidating office space in Los Angeles.

Playboy hopes to transition its DVD activities into exploiting online programming, which is considered a profitable operation for the company. Next year, the company will re-launch its Web site, Playboy.com, which will better integrate its publishing and online businesses.

“We will continue to deliver more of our content digitally, using our assets across multiple distribution platforms and adding more a la carte offerings,” said Hefner. “Given the declines in the DVD market, we will exit that business in phases over a few months to concentrate on selling that content online.”