In Slate, Edward Jay Epstein reports on Fox’s plans to pretty much subsume the entire video rental market by distributing free (or low-cost) HD-ready Digital Video Recorders and establishing a vast HD-on-demand network via its satellite system, including movies-on-demand. The only problem is that, as it stands, DVDs are customarily released to stores and rental outlets at least 45 days before they’re made available to PPV services:
To make digital video on demand work, Murdoch would have to overcome a formidable barrier-the 45-day head start that video stores have been given. This so-called “video window” is the result of a long-standing unwritten agreement among studios to delay the electronic delivery of movies for at least six weeks after video stores have had the opportunity to rent them. Because most people rent movies the week of their release-indeed, more than 80 percent of rental earnings comes in the first two weeks-most would-be renters have already seen a new release by the time the 45 days have elapsed. To get these renters, Murdoch would have do away with the delay and deliver his movies to his subscribers on DVR the same day that they are available in stores.
The main corporate proponent of this ‘video window’ is, of course, Wal-Mart, the country’s biggest DVD retailer, which will resist any change in the 45-day policy for fear of having to compete with PPV services like Murdoch’s grand scheme. Fox vs. Wal-Mart- could go either way.