My Two Cents
Monday, 23 October 2023 15:43

A Digital Bits Editorial: Hollywood Can Reap the Rewards of Physical Media Again, But Only If…

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I’ve been thinking a lot, in recent days, about the future of physical media.

Frankly, I can’t recall a time in this industry that’s offered greater cognitive dissonance than this past week, which began with the news that Best Buy is exiting the disc business—and saw a Digital Bits headline on the subject appear in Jimmy Fallon’s Tonight Show monologue—but ended not only with the release of Barbie and The Exorcist in 4K, but also with the Ultra HD announcement of Titanic, The Color Purple, and Oppenheimer, to say nothing of the revelation (by Kino Lorber Studio Classics) that Stanley Kubrick’s earliest films are coming to the format!

What’s the opening line of A Tale of Two Cities again? “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity.” Charlies Dickens was nothing if not a visionary.

This coming December, I’ll mark my twenty-sixth year as editor of The Digital Bits, and my thirty-fifth as a working professional in the business of media more generally. For most of that time, I’ve had a front row seat from which to view the ebbs and flows of the disc business—both its public-facing portion, as well a singularly-unique insider’s perspective. I launched The Bits website in 1997, at the height of LaserDisc and the dawn of DVD, to create a nexus between fans of these formats and the industry professionals who create them.

Soon afterwards, I gave the world its first look at Circuit City’s pay-per-view DIVX format, then led the crusade against it. I co-led a campaign that convinced George Lucas to begin releasing his beloved Star Wars films on DVD. I reported from the trenches on—and correctly predicted the outcome of—the high-definition format war between Blu-ray and HD-DVD. And I’ve covered every minute of the Golden Age of Physical Media, the rise and stumbles of Digital and streaming, and the continuing adventures of our favorite little format that could… 4K Ultra HD. [Read on here...]

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It’s certainly been an interesting journey, and I’ve been struck all along the way by other so-called experts—both professional and amateur—who have confidently made claims about this industry that were simply wrong-headed, revealed a lack of experience or personal knowledge, or were otherwise obviously false. And I’ve been reminded of that this past week, as I watched several breathless commentators declare the Best Buy news as “the final nail in the coffin for physical media” or “the death of the disc business.”

That’s just nonsense.

Yes, it’s true that Best Buy offered a number of good retail exclusives for disc fans, including Steelbook versions of popular titles. But have any of you actually been to a Best Buy in the last five or six years? Even on a Tuesday, most of their stores are like ghost towns. The last time I visited the retailer to purchase an exclusive title, I actually had to ask a clerk to find it because the store hadn’t even bothered to put the discs out on the sales floor!

The simple fact is, Best Buy hasn’t been a serious part of the physical media equation for a very long time now.

It may surprise some of you to know that Best Buy—for all their vaunted exclusives—only commands about a 4% share of the disc sales market, most of which is online sales. The 800-pound gorilla in the disc business remains Walmart, with a whopping 45% of the market. Amazon follows at roughly 18% and Target has about 6%. The remainder includes traditional brick-and-mortar retailers like Barnes & Noble and Bull Moose, and online retailers like Deep Discount, DiabolikDVD, Zavvi, and DVD Empire, as well as boutique labels that have created their own online stores to sell directly to their customers—think Shout! Factory, Disney Movie Club, Criterion, Kino Lorber, Arrow, Vinegar Syndrome, and more.

Best Buy’s decision to get out of the disc business is really part of a strategic shift by the company away from legacy electronics and media categories and toward cutting edge “lifestyle” technology products and services—think gaming devices, wearables, health monitoring systems, power tools, e-bikes, and the like. (My old friend TK Arnold did a good piece on this over at Media Play News just last week.)

From a sales standpoint, Amazon would seem to be the most likely beneficiary of Best Buy’s exit, thanks to their online strength with Prime and their massive global distribution network. And given the market numbers I shared a moment ago, it’s no surprise that Walmart has investigated the idea of a partnership with Studio Distribution Services—the more efficiently and profitably Walmart can sell and ship discs, the greater the financial incentive for them to keep doing so.

But according to the Digital Entertainment Group (DEG), consumers spent just north of $2 billion in 2023 buying discs. That’s revenue the major Hollywood studios simply can’t afford to walk away from, especially as their streaming operations balloon into budget busters and the theatrical business declines too, with audiences growing weary of bloated blockbusters from the same old franchises, and smaller, more creative and original films have been so driven completely out of multiplexes that nobody even bothers looking for them anymore.

The bottom line is this: There are still lots of diehard fans, collectors, and film enthusiasts out there who are eager to purchase their favorite films and TV series on disc.

One impact the Best Buy decision might have, is that certain Hollywood studios are probably going to have to work a bit harder on their disc releases than they’ve had to previously. One of the key advantages of working with Best Buy—at least from the studio perspective—has been the fact that the retailer would often buy entire runs of Steelbooks, which meant the studio in question was essentially guaranteed a profit on a title up front, and wouldn’t have to worry about unsold product being returned. As you might imagine, that had the unique effect of making risk-adverse studio executives a little more confident in their release decisions.

A complaint I’ve heard recently from insiders, is that studio executives wish the US was more of a collector’s market, like Japan. But the thing is, the major Hollywood studios have done almost nothing in recent years to encourage physical media collecting!

Disney essentially walked away from the catalog disc market for several years, and is only now—finally and to their credit—beginning to dip their toes back in. Warner Bros has been content to release just a dozen or so 4K catalog titles a year, carefully chosen by committee to appeal to middle-of-the-road tastes, each with generic Photoshopped cover art and little to nothing in the way of new special features. And Sony is only now starting to bring some of its most popular 4K catalog titles back into print, despite the fact that they keep selling out everywhere in just days—Lawrence of Arabia is a perfect example. Their Ghostbusters Ultimate Collection too was completely sold out before street date, and even many who thought they had secured a pre-order were ultimately short-changed.

Meanwhile, Paramount, Universal, and Lionsgate are releasing lots of 4K catalog titles, and indie labels like Shout!, Kino Lorber Studio Classics, Criterion, Arrow, and others are licensing deeper 4K catalog offerings from the major studios like gang-busters. And when those discs do arrive, they come with great cover artwork, tremendous A/V quality, and both new and legacy extras. Hell, damn near every KLSC 4K title includes lossless audio and Dolby Vision HDR on a 100GB disc! If they can do it, why can’t Warner and Disney?

The simple truth is this: If you want a thriving collector’s market to exist here in the States, you have to help build it!

That means you have to understand your market, and you have to cater to it. You have to make a genuine effort to get to know your best customers—what titles they want, what features they care about, what’s important to them, and what they like and dislike.

How many Disney executives—by which I mean the people actually making the decisions at the studio about what catalog titles to release in 4K—could explain why people care about Dolby Vision HDR and uncompromised Dolby Atmos audio? How many of them understand why it’s important for their 4K titles to be released on 100GB discs? Or why it’s important that their 4K UHD discs should even more of a premium product than Disney+? Hell, how many of the decision-makers at Disney are even avid consumers of their own discs? How many of them are home theater enthusiasts, with large collections of titles? How many of them have expertise on Blu-ray and 4K A/V quality? How many of them are aware that cinephiles and disc fans care just as much about classic Disney titles like 20,000 Leagues Under the Sea, and 20th Century Studios and Hollywood Pictures titles like Patton, Master and Commander, The Rock, and Tombstone—as they do about the Marvel Cinematic Universe and Pixar? How many are cinephiles themselves?

Before I continue here, I definitely want to take a moment to give Disney praise for the great work they’ve in the last few months with 4K. Their recent Cinderella and Snow White 4K discs have been fantastic, with gorgeous new transfers that actually look filmic and aren’t scrubbed of all their grain and character. Their release of the Hulu streaming title Prey was a genuine surprise, and that disc was pretty great too. Even more surprising has been their recent announcement of Disney+ streaming series coming to 4K Ultra HD, including Loki, WandaVision, and The Mandalorian. And if Loki is any indication, the A/V quality of all of them should be terrific. I’m thrilled to see that Indiana Jones and the Dial of Destiny will arrive in 4K on a 100GB disc! So too will Titanic, and with Dolby Vision HDR and Dolby Atmos audio—while that’s a Paramount title here in the States, Disney was involved in its production and will distribute it internationally. And Disney hasn’t even announced their other James Cameron 4K catalog titles yet—The Abyss, True Lies, and Aliens—but those are coming too. Not only should all of them feature 100GB discs, The Abyss and Aliens will include both versions of the films!

That is a remarkable turnaround in the 4K catalog space from Disney, and I sincerely hope it continues. No one will praise the studio more highly than we will here at The Bits if it does. Disney has control of so many titles that fans would kill to own in 4K Ultra HD!

But let’s shift our attention to another studio for a moment: How many Warner Bros. executives fully appreciate that when they release 4K titles with glaring errors or A/V defects—think the Superman and Rocky 4K box sets, or Max Fleischer’s Superman on Blu-ray (and don’t tell me that wasn’t an error—a video data rate of 15 mbps is less than streaming quality for heaven’s sake)—and then refuse to fix or even acknowledge them, they’re doing serious reputational damage to their brand?

How many Warner Bros. executives understand that when they release a title like The Exorcist on 4K in the US with ugly Photoshopped cover art and no Blu-ray—yet UK fans get an elaborate Ultimate Collector’s Edition with 4K, Blu-ray, original poster artwork on the cover and swag items—they’re letting down their best customers? How many of them appreciate that 4K Ultra HD fans are dying for titles like The Right Stuff (which celebrates its 40th anniversary this week), Excalibur, Forbidden Planet, and King Kong? Yet what are they planning instead? The Ocean’s remakes? American Sniper? Warner used to be a studio that nurtured and supported great filmmakers, including the likes of Stanley Kubrick. So why haven’t Barry Lyndon, Eyes Wide Shut, and Lolita been released in 4K yet? For that matter, where’s Christopher Nolan’s Insomnia, the Wachowski’s Speed Racer, and Brad Bird’s The Iron Giant?

Twenty-six years I’ve been involved in this business, and every year these release decisions seem to make less and less sense.

Meanwhile, the terrific team at The Warner Archive Collection continues to knock their Blu-ray catalog title selection and A/V quality out of the park. So clearly, the studio has people on hand who not only know what they’re doing—they’re actually doing a great job at it!

And while Paramount has largely been doing a great job of their 4K releases, I do feel the need to poke them here for two things. First, where the hell is Galaxy Quest in 4K? And second, why wasn’t Star Trek: Picard – Season Three released in 4K Ultra HD? I mean, come on—every single fan who purchased the Star Trek: The Original Series and Star Trek: The Next Generation movies in 4K would buy that! I’m told that even showrunner Terry Matalas pushed for a 4K release. And for those who say that the series wasn’t finished in 4K so what’s the point… nonsense! Take a look at Game of Thrones: Season One in 4K! That was only finished in 1920x1080 resolution and yet it looks fantastic on 4K UHD, benefiting from 10-bit color, much higher video data rates, and advances in upsampling technology. And Picard streamed in HDR on Paramount+! Come on, Paramount… take our money. (I say that with a wink: Paramount, you guys really have been doing a fine job with 4K.)


I was recently asked by a rep for a studio that shall remain nameless to provide a list of titles I thought 4K fans would really be excited to own on the format. Mind you, this is a studio that’s too long let its catalog languish. So I was happy to submit a list of fifty titles I know for a fact would sell like hotcakes. In fact, I provided an A-list of major titles whose names everyone knows, as well a B-list of deep catalog or cult favorites that have historically sold very well on disc. Now, I don’t know if the senior decision-makers at the studio in question even saw those lists, but I have a suspicion that—if they did—most of these people would have looked at the titles in surprise and asked, “Do we own these films?”

The two questions I hear most often from readers of The Digital Bits are: “When is my favorite film coming to 4K Ultra HD or Blu-ray?” and “Why are most of the special features on Blu-ray and 4K Ultra HD titles so terrible now compared to twenty years ago?”

And the answer to both questions hangs almost exclusively on how knowledgable and experienced the studio decision-makers are, and how willing they are to show the courage of their convictions when making release decisions.

The sad fact of the matter is that most of the studios executives who were really responsible for what we now think of as the Golden Age of Discs (from the late 1990s to around 2009-10) are gone. Some of them retired and many more were “downsized” during the COVID pandemic. Still more were let go as a result of consolidation, when studios like Warner and Fox were purchased by larger corporations. Typically what happened as a result, is that the studio’s home entertainment division was folded into the theatrical or streaming operation. So theatrical and streaming executives took over discs—the very people who have presided over the decline of the theatrical business and the massive overspending on digital—even as they let the disc business wither and atrophy.

But again, consumers spent $2 billion on discs last year in the US. And if the major Hollywood studios understood those consumers better—if they actually cared to listen to them and cater to their tastes and concerns—that number could certainly grow. If, if, if…

So that’s the situation we’re in now. Best Buy is leaving the physical media business.

Who cares!

You know who’s still in the disc business? Walmart, Amazon, Target, Barnes & Noble, Shout! Factory, Disney Movie Club, the Criterion Collection, FYE, Kino Lorber, Deep Discount, GRUV, DiabolikDVD, Arrow, BFI Shop, Zavvi, Bull Moose, DVD Empire, Hamilton Book, A24 Shop, Rarewaves, Flicker Alley, Eureka!, ClassicFlix, the Warner Archive Collection, Imprint/Via Vision, MVD, Mill Creek Entertainment, Vinegar Syndrome, Blue Underground, Powerhouse/Indicator, Plaion, StudioCanal, Umbrella Entertainment, Second Sight, All the Anime, Crunchyroll, Well Go USA, Fun City Editions, Synapse Films, Severin Films, Grindhouse Video, Terror Vision, Screen Archives, Unearthed Films, Dark Sky Films,, Import CDs, Ignite Films, Mercari, MovieZyng, Orbit DVD, Ronin Flix, 101 Films, Full Moon, 88 Films, Cauldron Films, Mondo Macabro, EzyDVD, Fnac, JB HiFi,, CD Wow,, PlayAsia, CD Japan… am I missing any? Surely, I’m missing some. This list barely scratches the surface of international retailers.

Yes, the world has changed.

Guess what? There’s still good money to be made in selling great Blu-ray and 4K Ultra HD discs to enthusiastic fans.

But the thing is—you have to care!

You need to put in some effort, you need to understand your best customers, and you need to release the titles they actually want most—not just the titles you recognize or that rise to the top of your P&L calculations. In fact, using P&L calculations as your primary indicator of what titles will sell on a new format in the home video business is the surest and fastest way to mediocrity. You need to talk to your customers! By which I don’t mean soccer moms at the shopping mall—I mean collectors, cinephiles, and avid 4K and Blu-ray disc buyers! Most of all, you have to actually do a great job on your discs quality-wise and really make them special—make them worth buying and collecting. Major studios can’t just phone it in anymore.

In short, it’s high past time at the major Hollywood studios to put people who actually understand the disc business back in charge of the disc business. And give them the resources and freedom to do what they do best.

So yes, you’re damn right Hollywood could reap the benefits of physical media again. And it’s high past time to start doing so.

Let’s get to work!

(You can follow Bill on social media at these links: Twitter and Facebook)



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