Warner Bros. Forces 56-Day Holdback Window For Netflix

Ouch. We knew the movie studios didn't like Netflix very much, but this is just brutal. In the viewpoint of the movie studios, they want people to go out and buy new DVD and Blu-ray releases. A rental provides only a fraction of the profit that an outright purchase would, but with $1 Redbox rentals and unlimited Netflix streaming for just a few bucks per month, why buy? There's hardly a good justification any more. But now, those who are impatient may find themselves buying more than renting. Warner Bros. Home Entertainment Group has just forced Netflix to wait 56 days to receive new release and made-for-video titles on DVD and Blu-ray Disc. That's up from the prior 28 day window that used to exist. Yeah, yikes.

Both companies are putting some spin on this, but let's be clear here: this is Warner Bros. taking a serious blow to Netflix's allure. Greed pays, we guess.

Warner Bros. Home Entertainment to Make New Release DVD and Blu-ray Titles Available for Rental Only After 56-Day Sales-Only Window

LAS VEGAS, Jan. 10, 2012 /PRNewswire/ -- Warner Bros. Home Entertainment Group and Netflix, Inc. (Nasdaq: NFLX) today announced a new agreement that will extend the current 28-day sales-only window to 56 days for Theatrical New Release and made-for-video titles on DVD and Blu-ray Disc.

"Since we implemented a 28-day window for subscription and kiosk, we have seen very positive results with regard to our sell-through business," said Mark Horak, president, Warner Home Video North America. "One of the key initiatives for Warner Bros. is to improve the value of ownership for the consumer and the extension of the rental window – along with our support of UltraViolet – is an important piece of that strategy."

Warner Bros. is balancing its home entertainment revenue streams by creating different times at which a product is available at different prices. A staggered schedule allows the Studio to maximize the sales potential of its theatrical new release titles and VOD offerings.

"Netflix wants to ensure members have continued secure access to Warner Bros. DVDs and Blu-ray discs and, as such, is accepting the 56 day holdback," said Netflix Vice President of Content Anna Lee.

The new agreement was announced at the annual Consumer Electronics Show in Las Vegas, Nev. in conjunction with an annual event held by the Digital Entertainment Group.
Tags:  Blu-ray, DVD, Netflix, Movies