Beginning later this month with Ridley Scott’s science fiction thriller “Prometheus,” the studio plans to offer high-definition versions of its films for sale at newly lowered prices about three weeks before making the movies available on discs and through video-on-demand services, studio executives said in interviews.
The new system is an aggressive bid to revive consumers’ interest in the purchase of movies, by giving them an earlier shot at films for about $15 each, down from a purchase price that is currently about $20.
That will nibble into what has been a waiting period of roughly four months in which pictures play exclusively in theaters before their release in home entertainment formats.
But the system is less provocative than a failed experiment last year. Under that plan, Fox and others briefly offered some films for about $30 through an on-demand service just two months after their theatrical release — an effort that was quickly curtailed after theater owners cried foul.
“We felt it was a good time to take a more dramatic step,” said James N. Gianopulos, who, with Tom Rothman, is a chairman and chief executive of Fox Filmed Entertainment.
The struggle to revive home video sales is critical for the industry; consumer spending on entertainment delivered through discs and other formats has fallen from a peak of about $21.8 billion in 2004 to about $18.4 billion last year.
Mr. Gianopulos, who spoke by telephone, said several factors converged to make the timing right for the new initiative: the growing consumer comfort with digital purchases; an expanding base of retailers like Amazon, Google Play and Apple’s iTunes; and the potential drawing power of “Prometheus.”
Though the movie has been just a middling performer, with about $350 million at the worldwide box office, its credentials as part of the “Aliens” cycle promise heavy home viewing. It will become available to digital purchasers on Sept. 18, in advance of its Oct. 11 release on DVDs, Blu-ray discs, and video-on-demand services.
In a bit of rebranding, Fox will call its electronic sale offerings “Digital HD” or “DHD.” It is an attempt to charm viewers by putting aside a bit of industry jargon: “electronic sell-through.”
As part of the initiative, Mr. Gianopulos said, Fox will finally join the UltraViolet digital locker system that is already used by Warner Brothers, Universal Pictures and others to make films available, once purchased, on virtually any of a consumer’s entertainment devices.
Earlier this year, Jeffrey L. Bewkes, the chief executive of Time Warner, said he would not be opposed to earlier sale of Warner films on UltraViolet, as long as the studio felt antipiracy measures were working, though he stopped short of putting a program into place.
Mr. Gianopulos said it was not so much concern with piracy that had kept Fox out of UltraViolet until now as it was other early concerns with the workability of the locker system. He said he believed Fox was the first studio to go so far as to offer a three-week early window for digital sales.
“We’re trying to get this process started,” he said.
Mr. Gianopulos said Fox would offer the early, lower-priced sales on all of its forthcoming movies for an indefinite period, while monitoring the results. Based on discussions with exhibitors, Fox executives said they believed the move respected any concerns about narrowing the theatrical window. Mr. Gianopulos acknowledged that Fox was nudging home video “a little closer” to the theatrical release. But, he said, most films are out of theaters long before they will be available for purchase digitally.
According to figures from the Digital Entertainment Group, an industry consortium, digital sales of films and television shows — as opposed to revenue from rentals or on-demand viewings — rose almost 22 percent in the first six months of this year, to $329.4 million, from $270.3 million in the first half of 2011.
But digital sales remained relatively small when compared with the sale of movies and shows on discs, which totaled $3.7 billion for the first six months of this year, down about 3.6 percent from the same period last year.
Mr. Gianopulos said he expected consumers to vary their viewing and purchasing habits on a film-by-film basis.
Effects-heavy movies like “Prometheus” and “Avatar,” he said, will most likely still find a large audience via Blu-ray discs, which offer an especially rich viewing experience. But comedies, he predicted, would increasingly find an audience among digital purchasers, who might view them several times on any number of devices, large and small.
Fox executives said the new, early sales system would be introduced simultaneously in about 50 countries around the world. The studio’s more recent films, like “Abraham Lincoln: Vampire Hunter,” “The Watch” and “Ice Age: Continental Drift,” will all be available digitally at about $15 in advance of their release on discs, they said.
Mr. Gianopulos said executives had considered the early sale of films for even less money in a standard, rather than high-definition, format, but decided instead to lead with a premium product. (Standard-format films remain available for digital purchase when the DVD is released.)
“We felt we should put our best foot forward,” he said.
Author: MICHAEL CIEPLY