In a first for the cable industry, Viewer's Choice
will pay an upfront guarantee to secure early pay-per-view window rights to Buena
Vista's blockbuster hit The Waterboy.
The move marks the industry's first major effort to
effectively compete with the direct-broadcast satellite industry for the rights to early
movie titles, although The Waterboy will only be available to Viewer's
Choice's digital subscribers in the early window.
Viewer's Choice will ante up at least a 20 percent
guarantee for the right to distribute The Waterboy ($160 million at the box office)
in late April -- one month before its May analog-PPV debut and a little more than one
month after the film's debut on home video.
The PPV network had previously passed on several early
window titles -- including one Buena Vista title, 6 Days/7 Nights -- allowing
DirecTV Inc. to premiere the films before PPV.
But The Waterboy will only be shown to Viewer's
Choice's digital subscribers, totaling about 1.5 million. The network serves as the
digital-PPV provider for Comcast Corp.'s digital services, and it still offers eight
channels as part of AT&T Broadband & Internet Services' (formerly
Tele-Communications Inc.) Headend in the Sky digital platform.
"We have it in the early window for our digital
customers. It's something that we're trying at this point," said Michael
Klein, senior vice president of programming for Viewer's Choice. "We're
happy to have it  days after home video."
Klein, however, would not speculate as to whether its
digital homes can generate a buy-rate of 20 percent or more on the film to make the move
Many PPV observers said matching or surpassing buy-rate
guarantees of 20 percent or higher for early windows is a very risky financial proposition
for any distribution company, given the current level of PPV-movie buy-rate performance.
Operators on average generate buy-rates of between 1
percent and 5 percent on nonadult films, although experts believe that a 20- to
40-channel, near-video-on-demand digital service similar to Viewer's Choice's
could easily reach double-digits.
It's unclear whether DirecTV has been able to meet
similar guarantee numbers for its early window releases, although most industry observers
feel that DirecTV's 150-channel PPV operation can easily reach those lofty levels.
Thus far, the DBS service has offered two Columbia/TriStar
titles (Godzilla and TheMask of Zorro), as well as Buena
Vista's 6 Days/7 Nights.
Representatives from DirecTV could not be reached for
comment at press time.
The Waterboy is part of a multititle distribution
agreement between Buena Vista and the PPV distributors that encompasses the early window
While it's unclear how many titles will carry the
early window, sources close to the situation said Buena Vista's summer release of Enemy
of the State could be the next guarantee-laden title.
As far as TheWaterboy is concerned, Buena
Vista executives are happy that it's receiving strong support for its early window.
"We're excited about the film, which has
performed well at every window previous [to PPV]," said Dan Cohen, vice president and
general manager for Buena Vista Pay TV. "Moreover, we are encouraged that [the
industry] is taking the early window."
One operator offering Viewer's Choice's digital
service was excited about the early window opportunity. "It finally puts us on a par
with what DirecTV is doing," the operator said. "We can finally say to our
subscribers that we have what the other guys have."