For consumers, the decline of the DVD market has meant switching over to both Blu-ray and, more recently, streaming options for their viewing pleasure.
The end of the DVD format’s dominance meant something much more, and far worse, for Hollywood.
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Veteran producer Lynda Obst describes the fallout of declining DVD sales in Salon, part of an except from her new book Sleepless in Hollywood.
Obst describes an industry flailing for new revenue in the wake of the DVD collapse, a business frozen with fear over doing the wrong thing. She also details how many industry power brokers are suddenly desperate for cash, their years of high living suddenly over.
They’re completely broke,” said a studio head, when asked by me (of course) about how different things were these days. He spoke about famous players who regularly came to him begging for favors–a picture, a handout, anything….
They have extremely high overheads,” he said to his guest with me listening in. “They have multiple houses, wives, and families to support. They’ve made movies for years, they were on top of the world and had no reason to think it would end. And then suddenly it did. They’ve gone through whatever savings they had. They can’t sell their real estate. Their overhead is as astronomical as their fees used to be. They’ve taken out loans, so they’re highly leveraged. It’s a tragedy.
As for the DVD debacle, Obst recalls a chat with a visionary industry leader who breaks down what the DVD’s demise meant for his peers.
The DVD business represented fifty percent of their profits,” he went on. “Fifty percent. The decline of that business means their entire profit could come down between forty and fifty percent for new movies.