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As DVD Sales Slow, Hollywood Hunts for a New Cash Cow - New York Times, 6/13/06

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  • As DVD Sales Slow, Hollywood Hunts for a New Cash Cow - New York Times, 6/13/06

    As movie companies like Disney continue to embrace the technology of new media, the tried and true DVD keeps hanging on . . . but what's next?

    LOS ANGELES — After more than half a decade as Hollywood's savior, the DVD is looking a little tired — and the movie studios, for once, are having trouble coming up with a sequel.

    DVD sales represent more than half of the revenue studios generate from most of their movies. But those sales are expected to grow just 2 percent this year, a far cry from the double-digit growth the industry enjoyed just two years ago. High-definition DVD's were supposed to pick up the slack, but technical delays and a thorny format war between camps led by Sony and Toshiba have dampened expectations.

    Studios are starting to beam digital movie files to consumers over the airwaves and send them through the Internet, but sales so far are minuscule. Rentals and video-on-demand, though growing, generate far smaller profits for the studios than store-bought DVD's.

    This explains why executives who gathered here earlier this month for an industry conference expect, for better or worse, that the plain old DVD will remain their bread and butter for several more years. Meanwhile, they are trying everything they can in their quest for a new cash cow.

    "The technology seems to change every Monday," said Bob Chapek, the president of Buena Vista Home Entertainment, a division of Disney, speaking on a panel of studio chiefs. "On the one hand, we're playing in the old-fashioned packaged goods business, and at the same time, we have to deal with new technologies."
    Full Story: As DVD Sales Slow, Hollywood Hunts for a New Cash Cow
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