Many people don't bother to see certain movies in the theater, but rather wait for them to come out on video. If it were known in advance that a certain movie would never come out video, more people would go to see it in theater. On the other hand, the closer a video release is to the original theatrical release, the better it does. Hollywood therefore settled on a standard waiting period between the two releases, which is designed to maximize total revenue.
While it wouldn't work for most movies, Hollywood may want to consider the following. Make two different versions of the film, with different plots and different endings. For some movies this would only require a bit more filming and different editing. The two 90 minute movies may only differ by a total of 20 minutes, but those properly chosen 20 minutes can completely change the film. The studio can then announce that the version shown in the theater will be different from the version that will be released on video. This may encourage more people to see it in the theater, and it may in turn get more of those people to subsequently watch the movie on video.
On the other hand, it may simply encourage more illegal bootlegging of the theatrical version…
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Well not exactly the same idea, but I recently saw an article that contained an interview of Mark Cuban about his plans for Landmark Theaters (the chain he along with other investors recently purchased and announced plans for rolling out Digital Projection to).
In it, he alluded to considering the option of "buy the DVD on the way out the door" - especially when showing, as he plans on focusing on, independant/limited release films. (he also owns a movie production business that makes low-budget films).
A recent mailing from Landmark Theaters included the following:
"Incidentally, we're trying something new here to go along with the opening of THE BARBARIAN INVASIONS... THE DECLINE OF THE AMERICAN EMPIRE was Denys Arcand's breakthrough film from 1986, which first introduced the central characters of THE BARBARIAN INVASIONS. Right now it's only available in the U.S. as an expensive VHS import, but starting this week, we'll be exclusively selling the DVD for a mere $14.95! Inquire at the box office starting Friday..."
So they are starting in a small way...
Seems like this DVD at the door idea would drastically reduce theater ticket sales. If I ask a friend, "how was ____?" He says "Great, I even bought the DVD" WOuld I go see it in theater, or would I ask him to borrow the DVD?