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Before you begin to think too highly of him, remember that this is the man who gave us two 'Madagascar' films.

Every now and then, it’s refreshing to hear some brutal honesty from a Hollywood executive. Speaking at the recent Jefferies & Co. Global Internet, Media & Telecom Conference, DreamWorks Animation CEO Jeffrey Katzenberg said that the decline of DVD sell-through is unlikely to reverse itself anytime soon, and the studios may have only themselves to blame.

Katzenberg, who has been a major Hollywood player for a long time, said that the change in the home video market was “systemic” rather than “cyclical”. He also stated that the studios’ “greed killed the goose” as Hollywood mistakenly believed that consumers would never lose their willingness to pay high prices to own DVDs. Said Katzenberg:

“Two, three years ago people had no problem purchasing a DVD for $18 . . . Suddenly, $20 is something you think about. Twenty dollars for a DVD you will watch once or twice, in a world where there’s Netflix, Blockbuster, Redbox, many VOD services, digital delivery, Amazon, we can go through the list of options on a per play basis where you can watch for $5 or $3 or $2.50 . . . The overall movie world is having to deal with the change in consumer habits.”

Katzenberg’s comments come across as some rather clear thinking for a studio executive. His comments echo the exact same sentiments I felt a few years ago when I looked at my shelf full of expensive DVDs that had mostly been watched once (or were still in the plastic wrap) and I decided that something had to change.

Is Katzenberg’s candor long overdue, Insiders? How many of you have given up on collecting a large home entertainment library when so many cheaper rental options are available? Can anything stop the demise of the DVD? Weigh in with your thoughts in the comments.

(via Home Media Magazine)

25 Responses to “Dreamworks Exec on DVD Sales Decline: “Greed Killed the Goose””

  1. Member [Join Now]
    starman15317

    I love the photo caption. Don’t forget the Shrek sequels!

    I rarely pay $20 for a DVD, it’s a crazy price. I think $9.99 may be too much for dvds with no special features. I usually buy dvds used, as well as cds, which saves me a lot of money

  2. Visitor [Join Now]
    Mike [visitor]

    I own a video store that buys and sells used DVDs. I had a customer bring in 300 movies to sell to me. She told me that she had over 1200 DVDs at home that she had all bought new and only watched once. That means she spent approximately $25,0000 over the years on her collection. For approximately 1/4 of her collection, I gave her around $450. Not a very good return on your investment if you ask me.

    She could have rented all those movies, even at Blockbuster prices and still come out ahead.

    • Visitor [Join Now]
      rb [visitor]

      Owning a video store that buys and sells used dvds, you certainly have inside information/credibility regarding consumers ever changing needs…I think the majority of people who used to just ‘buy’ movies to build a collection have now become extremely picky once they realized they actually only watch the movie once, twice tops, unless it’s a classic–like Wizard of Oz, Casablanca, Grease, Disney classics, etc. Don’t think consumers are into just buying dvds/movies anymore just for the sake of building a collection–like they used to when the economy was better, and before movie formats kept changing so readily..Vhs,dvds,bluray, 3d,etc. Now with talk of digital being the future, I only think award winner dvd/blurays like Avatar, Blindside, Up, etc. will be the dvds collectors still buy… Unless they find a video store like yours and can pick up a few used dvds for the same price that a place like b&m Blockbuster charges to rent!

  3. Visitor [Join Now]
    Nicole Maki [visitor]

    Buying DVDs was one of the first things to go when we decided reducing debt was our best option in this economy. After letting a few must-haves slip through our fingers, we realized renting was a lot easier than even finding shelf space for new movie purchases. I think we’ve bought less than five DVDs in the last two years. We use Netflix, Redbox and Amazon downloads instead.

  4. Visitor [Join Now]
    Marc [visitor]

    I still buy DVDs, but I almost always buy them used at places like Blockbuster, who has a 4 for $20 deal always going on. I do have a lot of movies that I have only watched once, but I do still like collecting the movies I like. I don’t buy movies or CDs digitally because I feel like if everything went digital we would have no reason to leave the house. I actually like the go to stores. Technology is great but it is making is lazier and you can’t deny it.

  5. Member [Join Now]
    richmoral

    The only DVDs I buy are TV Season Boxsets. Movies I’ll just rent. That and I go to a lot of free movie screenings. Like just the night before last I went to a screening for the new Robin Hood movie. It was good and I enjoyed it. Tonight I’m going to see Queen Latifah and Common’s new movie Just Wright. Then on Saturday I plan to attend the screening for Shrek Forever After.

  6. Visitor [Join Now]
    greenpad [visitor]

    We used to buy movies from time to time, and that has all but stopped. We still watch about the same number of movies, but there just isn’t any reason to watch a movie repeatedly anymore. I used to like having my favorites so when we traveled we could watch them, etc. But nowadays, there is almost always *some* way to get a new movie, whether from redbox, itunes, etc.

  7. Visitor [Join Now]
    Firstlawofnature [visitor]

    Interesting story. The studios didn’t know how good they had it during all those years where your customer was building her library. I suspect they won’t get even half that amount from her over the rest of her life.

  8. Member [Join Now]
    ecc1v9

    Never in my life have I understood those who buy movies. Crazy waste of money.

  9. Member [Join Now]
    MovieWatcherSupreme [moviewatchersupreme]

    I don’t buy movies anymore, but then again, I live by myself and have a 13″ crt television with a converter box on top. My laptop has a bigger size screen for goodness sake. (When measured corner to corner). But back when I lived with my folks and brother, we would by movies all the time. Mainly because we watched the same movies over and over and would constantly add to the collection and watch those over and over as well. For example, we had National Lampoons Christmas Vacation on VHS in the late 90’s and played that thing to death well into the 2000’s. Then we got it on DVD and watched it all the time like maybe twice a month. We just really connected through that movie. Other movies were like that as well. But now being on my own I just rent what I am interested in from Redbox and do a little “computer magic” to keep it if I like it. Works for me.

  10. Visitor [Join Now]
    UBM [visitor]

    movies I bought for $20 because they meant something to me:
    * Star Wars
    *Star Trek Wrath of Kahn
    * Batman
    * Empire Strikes back
    *A Nightmare on Elm Street

    everything else I’ve rented or bought for no more than $3,
    mostly PVT , or Video Store Closing inventories.

    It’s great to finally see someone “high up” finally speak out
    on the stupidity of the movie studios. Food and Shelter
    will always beat out $20 a pop for a movie.
    The 28 day waiting period will only backfire,
    and when Wal Mart stops buying caseloads of DVDs
    because of it, the studios will finally get it.

  11. Visitor [Join Now]
    carterjay [visitor]

    It’s not $20 for a DVD, it’s $29 for a blu-ray disk that’s derailed my collecting habits completely- plus the massive reduction in outlets for DVD’s has completely changed. I used to buy one DVD a week at Media Play- or the Virgin store- both are now gone. Now I buy one blu-ray disc once every 5 weeks maybe, if at all and I usually regret making half of those purchases. If netflix can get their inventories of blu-ray up, then I’ll most likely stop buying any movies ever again.

  12. Visitor [Join Now]
    ian [visitor]

    the home entertainment divisions (esp Sony with their Scan Based Trading) have devalued dvd. when consumers can buy films at $4.99 brand new at nearly every grocer, pet store, truck stop, it’s hard to get $20+ for brand new releases! when walmart asks for SBT, it’s over for the studios

    consumers have also realized they haven’t watched most of the films in the library, so why continue to collect dvds (or blu rays).

  13. Member [Join Now]
    ChadCronin [chadcronin]

    I have a few regret purchases. I have bought some because family said they wanted me to get stuff or hadn’t seen it, then the excitement dies down after they see it and it just sits on the shelf. Sometimes I will buy a movie because it’s a new release and I think if I wait it won’t be on shelves later, so I get it then not even end up watching it for a long time. I look at my collection and wish I had the money instead of being broke. I am more carefully with my purchases on Blu-ray than DVD, but I need to be even more choosy

  14. Visitor [Join Now]
    rainie [visitor]

    we tend to buy older movies only for the most part. we rent new ones to see if we like them but then we always buy used about 90% of the time. the only reason for us to keep building our collection though is because we are planning on moving to the country and getting rid of cable/sat. and so movies will be our only means of tv time. but when i can buy online 8 dvds for around $30 w/ship/handeling and movies i know we love and will continue to keep watching its better then sitting around wondering when cable will play things we will watch.

  15. Visitor [Join Now]
    Liz A [visitor]

    I can see no earthly reason to purchase a DVD ever. I have drawers full of “must own” VCR tapes. Well, fool me once….right? If it’s good, it runs and reruns on the cable channels.

  16. Visitor [Join Now]
    Fi [visitor]

    As an avid film buff I do purchase a lot of dvds. However, I have ceased all purchases until I am confident of where the standard format is going to end up. As with my large collection of VHS that is worthless now, I do not want to continue buying DVDs if in another year everything is going to be BlueRay only or whatever.

    I am also particular about what movies I purchase. Is it a movie that I love so much that I will watch it several times? A movie that I will pull out in a year and enjoy watching all over again? It seems lately that Hollywood isn’t producing much that I would consider great movies. If anyone has seen Fern Gulley and or Pocahontas they would not be particularly impressed by Avatar. Personally I would rather own Pocahontas because I enjoy singing the songs along with the movie.

    • Visitor [Join Now]
      rb [visitor]

      Funny you should mention Pocahontas because when I saw Avatar, I said it reminded me of the movie Pocahontas–only a special-effects version of the Pocahontas/John Smith type of storyline.

  17. Visitor [Join Now]
    BDA123 [visitor]

    I have never been much of a DVD purchaser. Price is definately a consideration, but space was also a big one. I know it seems like you could just take the discs out of the case and save them in a sleave but it is just time consuming and a hastle. Now I just purchase two things. I purchase the DVD/Bluray copy of new Disney/Pixar movies that I think my kids will watch 3+ times or I buy very good Bluray experiences like Avatar, Star Trek, Pirates, or something like that. I put them all on my HTPC and have one link in my media center for the kids movies and one link for the “grown-up” action movies. There are a few realllllly good romatic comedies that make it into the mix also, but that is rare. No need to buy anything else. I probably spend my more money on renting old TV episodes of shows that I pickup in season 2 or 3 then I do dvds. The industry definately needs to change. I like digital anyway you look at it. The other reason I like a digital copy of the movies that are seen several times is that I can hook up a laptop or Ipad to the HTPC and download whatever to take it on the road if we travel.

  18. Visitor [Join Now]
    usafsam [visitor]

    I still buy DVDs & BluRay but only those things we really like or items for gifting. I check WalMart’s $5 bin regularly, Pawn Shops, Yard Sales, Craig’s List, as wells as the local DVD rental shops for sales on used DVD’s. I signed up for Disney rewards to get their $10 off new release coupons then use sales, price matching, Store deals & coupon match ups to get the DVD+BluRay combo packs for as low as $1.99. I have also used Toys R Us sales and coupons to get deals like The Princess & the Frog for $5 each Dvd. Coupons.com & mommysavers.com usually have all kinds of movie coupons & deals posted (I bought Twighlight New Moon 2 Disc for $.99). I also use Netfilx streaming thru PS3 & Wii and Redbox rental using promotion codes for free nights rentals when available.

  19. Visitor [Join Now]
    Trisync [visitor]

    My cousin is the person that Hollywood money moguls hate. He rents the videos from the corner store for $2 (mostly Adult) or Redbox for $1 and then burns a copy of the keepers on his PC. The copies are as good as the originals… And here in Chicago, bootlegs are sold in every Barber and Beauty Shop. Yesterday I went to Walgreen’s where they have a Red Box in front of the store. There was a guy who’d set up shop right next to the box selling copies of Robin Hood and Just Wright @ 3 for $10 or $5 each.

  20. Visitor [Join Now]
    philmphreek [visitor]

    I believe part of the problem is Blu-Ray. No one wants to get caught in the Beta/VHS/DVD cycle again, where everything becomes obsolete. They’re waiting for Blu-Ray players and the disks to come down in price and then maybe, just maybe they might buy some. Or maybe not.

  21. Visitor [Join Now]
    RB [visitor]

    Like most I bought DVD’s and watched them once, perhaps twice in a blue moon! I do have some like Star Wars, Indiana Jones, but most I would not pay $1 to rent! If and when Blu-Ray become reasonable $5 or so I may buy some of the ones that I would like to keep on hand. But– I will never pay $15-20 again even for HD disks!

  22. Visitor [Join Now]
    pj [visitor]

    Blu-Ray and the recession.

    Fool me once, shame on you (the switch from videos to DVD)
    Fool me twice, shame on me (DVD’s to Blu-Ray, digital, on-demand).

    Maybe if you were able to copy the old fomats to the new format it wouldn’t be so bad. The day I bought a DVD player was the day I realized I wasted money on videos. But then DVD’s weren’t that expensive – especially from Wal-Mart or other discount retailers so I started buying them again. Now they’re $20 plus and let’s face it – the movies are not worth it.

    If I have to buy a Blu-Ray (only if it’s absolutely necessary) I will not build a Blu-Ray collection.

    Whomever wrote about the bootlegs is accurate: they are everywhere and I think the movie studios should look at Redbox as a bootleg fighter. If a bootleg costs $5 but a rental costs $1 – most folks are going to get the rental. Plus I don’t see bootleggers dropping prices to a dollar.