Digital Videodiscs

Matsushita, MCA to Form Videodisc Unit: Matsushita Electric Industrial Co. and MCA Inc. will form a Los Angeles company to produce films for videodisc systems, according to the Japanese newspaper Nihon Keisai Shimbun. The company, Digital Video Compression Corp., will be owned by Matsushita and staffed by employees from Matsushita and MCA, the newspaper said.

It's becoming increasingly clear that Disney's March 5 release of "Alice in Wonderland" may have helped trigger a dramatic tipping point in film history. The movie's 3-D ticket sales have been astounding, which has helped spur even more momentum for Hollywood's rush to turn nearly every movie imaginable into a 3-D release. The film provided a much-needed hit for Disney, even though the executives who put it into production -- Dick Cook and Oren Aviv -- weren't around to enjoy its success, having lost their jobs long before the film arrived in theaters.

For those who like renting movies, Hollywood may soon have a message: Prepare to wait. In an effort to push consumers toward buying more movies, some major film studios are considering a new policy that would block DVDs from being offered for rental until several weeks after going on sale. Under the plan, new DVD releases would be available on a purchase-only basis for a few weeks, after which time companies such as Blockbuster Inc. and Netflix Inc. would be allowed to rent the DVDs to their customers.

For the last decade, Hollywood has been mining comic books and fantasy novels for its blockbuster source material, with Harry Potter, Spider-Man, Batman and Gandalf leading the vivid parade. Looking ahead, though, the next generation of box-office champions may be coming from a different realm: the digital landscape of gaming. "Prince of Persia: The Sands of Time" hits theaters May 28, and World of Warcraft, Missile Command and even Asteroids are among the gamer brand names that are now in development.

Walt Disney Co., the second-largest U.S. media company, adopted Sony Corp.'s Blu-ray format for digital videodiscs, supporting its new standard for the home movie market. Disney's Buena Vista Home Entertainment will start releasing movies in the format when Blu-ray DVD players are available in North America and Japan, the Burbank-based company said. Disney said it might still release movies in the competing format by Toshiba Corp. Toshiba's HD DVD format has been backed by Time Warner Inc.'

Are VHS tapes about to join vinyl albums in the dustbin? In the latest sign of the rise of digital media, weekly DVD rentals exceeded videocassettes last week for the first time, according to the Video Software Dealers Assn. The trade organization said an estimated 28.2 million digital videodiscs were rented for the week ended June 15, outpacing 27.3 million VHS rentals.

Dramatizing a rapid shift in consumer electronics, Blockbuster Inc. announced Monday that its stores will dump one-fourth of their VHS tapes to make room for more profitable digital videodiscs. Blockbuster will take a $450-million charge against earnings to cover the inventory overhaul. The announcement was the latest in a series of moves and countermoves by Hollywood studios, which rely heavily on video rental revenue, and Blockbuster, the dominant source of those rentals.

A DVD industry group said Tuesday it has filed suit against dozens of Web site operators for allegedly posting a DVD copying program that the group says is illegal and could destroy the fast-growing new format. At the heart of the complaint is a program written by a Norwegian programmer that foils the encryption that prevents DVDs, or digital videodiscs, from being copied.

Hollywood's hopes that the DVD format would prove harder to pirate than videos and CDs are being badly dashed in China and other parts of Asia, where DVD piracy has emerged on a major scale. China's experience shows that DVD piracy, once seen in the West as largely a hypothetical threat, is both possible and profitable.

On Wednesday evening, Mike Chauvet opened a red envelope from Netflix and popped "The Hangover" into his DVD player. "I try to get most of the movies I watch through Netflix," said the 30-year-old physician, who lives in Queens, N.Y. Now he's going to have to wait for the privilege. Warner Bros. has struck a deal with Netflix Inc. whereby the fast-growing DVD subscription firm won't offer the studio's movies until 28 days after they go on sale. Had the deal been in effect last month, "The Hangover," which went on sale Dec. 15, wouldn't be available on Netflix until Jan. 14. It's part of a strategy by several studios to create staggered releases of DVDs so that the most profitable transactions are available first and cheaper rental options take effect further down the road.

On Wednesday evening, Mike Chauvet opened a red envelope from Netflix and popped "The Hangover" into his DVD player. "I try to get most of the movies I watch through Netflix," said the 30-year-old physician, who lives in Queens, N.Y. Now he's going to have to wait for the privilege. Warner Bros. has struck a deal with Netflix Inc. whereby the fast-growing DVD subscription firm won't offer the studio's movies until 28 days after they go on sale. Had the deal been in effect last month, "The Hangover," which went on sale Dec. 15, wouldn't be available on Netflix until Jan. 14. It's part of a strategy by several studios to create staggered releases of DVDs so that the most profitable transactions are available first and cheaper rental options take effect further down the road.

About a week before Christmas, I took a stroll around the Los Angeles Toy District and bought a pirated DVD. As I wrote on Dec. 21, curious about the quality of the merchandise for sale on the street, I shelled out five bucks for a copy of the movie "District 9," which was still days away from being available in your local retail store. As I've been informed, quite properly, by readers in and around the movie industry, that casual act made me part of a global problem that is killing jobs and eliminating opportunities for creative people everywhere.

It's not every day that movie theaters take retribution against a Hollywood studio. Exhibitors usually don't want to annoy the studios on which they rely for movies to keep filmgoers buying tickets. Yet last month major theater chains pulled the family-friendly animated comedy "Cloudy With a Chance of Meatballs" from big screens around the country. The action was intended as a warning shot at Sony Pictures -- and Hollywood in general. Sony said it simply wanted to make its movie available to owners of a new generation of the company's high-definition TVs a month before its release on DVD. But movie theaters weren't having any of it. They feared that moving up the date when people could watch the movie at home would discourage them from making a trip to the local multiplex.

They should just call it Bluebox and really have at it. NCR Corp., which is expanding aggressively in the DVD kiosk business via a partnership with Blockbuster Inc., has acquired competitor DVDPlay in a bid to catch up with market leader Redbox Automated Retail. NCR, which manufacturers self-service retail devices such as ATMs and grocery-store checkout devices, will put the Blockbuster brand name on its $1-a-night-DVD kiosks via a partnership with the struggling home video chain.

To celebrate the movie's 70th birthday, Warner Home Video is releasing a newly restored and remastered version today of "Gone With the Wind" for the first time on Blu-ray, as well as a standard DVD. The Technicolor film has never looked better because of new digital software and the fact that Warners was able to scan the original negative. "It is in beautiful condition," says George Feltenstein, senior vice president of theatrical catalog marketing for Warners, of the negative.

Good news for fans of classic Hollywood. Two film collections -- one featuring a screen legend from the 1930s and the other offering some prime film noirs from the 1950s -- have recently been released on DVD. Claudette Colbert was one of the top female stars during the Golden Age of Hollywood, winning an Oscar for 1934's romantic comedy "It Happened One Night." But she was more than just a comic performer. Colbert also was a deft dramatic actress who earned two more best actress nominations -- 1935's "Private Worlds" and 1944's "Since You Went Away" -- for complex, serious roles.

Southern California has emerged as an international hub of a multibillion-dollar business that didn't even exist five years ago: the production of digital videodiscs, or DVDs. With a handful of major manufacturers clustered around Hollywood studios, the region has more production capacity than anywhere in the United States, if not the world. One in five of the 730 million DVDs sold last year were made in California, according to London consulting firm Understanding & Solutions.

When the bottom fell out of the laserdisc market, it dealt a swift and staggering blow to Image Entertainment, which at one time was the largest manufacturer and distributor of laserdiscs, controlling more than 60% of the market. But over the last three years, the company has pursued a monumental change in strategy and has repositioned itself not only as an aggressive, if less prominent, manufacturer and distributor of digital videodiscs but has become noted for its unique line of concert DVDs.

An unprecedented round of online price cutting for DVDs started Thursday that could provide a much needed boost for the beleaguered home entertainment industry. Walmart on Thursday slashed the price of its 10 most popular DVDs that will be released soon, including "Star Trek," "Night at the Museum: Battle of the Smithsonian" and "Harry Potter and the Half-Blood Prince" to $10, less than it has charged for highly anticipated new movies in recent years. Target immediately announced that it would match Walmart's price.

Sony Pictures desperately wanted to release the DVD of the Michael Jackson concert movie "This Is It" for the holiday shopping season but backed down after movie theater owners complained that it would be too soon after the film's theatrical premiere. That thwarted the latest attempt by a Hollywood studio to shorten the "window" between when movies appear in theaters and when they come out on DVD as the industry grapples with a downturn in DVD sales, which have traditionally propped up the movie business.