Hollywood balks at big budget movies as DVDs drop. (Boston Globe, 9/17/2011)
Excerpt: Until recently, studios could afford to churn out movies with heart-pumping action scenes featuring pricey special effects and high-salary actors. Although many of those movies cost more than they garnered in ticket sales, Hollywood could count on overall strong sales of DVDs to make up for excessive expenses.
“The DVD buying boom covered up a lot of sins in the middle part of the last decade,’’ said Tom Adams, principal analyst and director of U.S. media for IHS Screen Digest.
But the curtain is falling on the DVD era. IHS said U.S. video disc sales fell from $10.3 billion in 2004 to $7 billion last year.
The popularity of low-cost rental options, such as Netflix and Redbox, along with the ease of piracy, has cut into DVD sales, making it tougher to profit from the movie business. Blu-ray disc sales and gains in digital purchases haven’t made up for the shortfall.
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