By Rick Aristotle Munarriz
December 13, 2007
If you like your stunt antics haphazardly senseless and occasionally tasteless, you're probably looking forward to Johnny Knoxville's Jackass 2.5. The rambunctious sequel is going direct to DVD later this month -- but don't bother loading it up on your Netflix (Nasdaq: NFLX) queue.
The DVD should be readily available for sale everywhere, but Blockbuster (NYSE: BBI) struck a deal with Viacom's (NYSE: VIA) MTV to give it exclusive rental rights. The film also will be streamed for free on Blockbuster's site, from Dec. 19 (a week before it hits stores) to Dec. 31.
This morning's Wall Street Journal breaks down the deal, with Blockbuster guaranteeing "around $2 million" to Paramount for the rental exclusivity. Blockbuster will pay Viacom more than 70% of the ad revenue beyond that.
Who wins here? Blockbuster, of course. It's going to draw a ton of freeloader traffic starting next Wednesday. On its home turf, Blockbuster will be free to pitch visitors its Total Access and real world rental service. The unspoken message will be clear: Netflix may have 90,000 DVDs available, but none of them will be Jackass 2.5.
Exclusivity is a powerful tool. If a studio is willing to be financially compensated to sacrifice its reach, the move empowers the only outlet for a particular product. Blockbuster isn't a pioneer here. Netflix has locked up exclusivity for arthouse films and documentaries in the past. Even Wal-Mart (NYSE: WMT) has tried to score with celluloid-loving couch potatoes before. It teamed up with Time Warner (NYSE: TWX) to bundle Superman Returns DVDs with an exclusive digital download last year, then joined forces with Disney (NYSE: DIS) for an exclusive High School Musical 2 soundtrack edition this summer.
Blockbuster is still pushing the envelope here. Keep in mind that this film isn't hitting your local multiplex. The very first crack that fans have at it will be at Blockbuster.com. The free stream is also a clever way to promote Blockbuster as a digital delivery source.
So this "exclusivity" is really a lasagna with plenty of savory layers that work in Blockbuster's promotional benefit.
The trend, though, may be a blessing to the industry as a whole. If Netflix and Blockbuster wind up with enviable collections of exclusive titles, movie buffs may find themselves having to subscribe to both services. In other words, it can be incremental for the sector. With Netflix and Blockbuster combining for the first quarter-over-quarter dip in DVD-by-mail subscribers in the segment's young history this past quarter, a word like "incremental" is a shiny life preserver in chilly waters.
Then again, splashing into chilly waters -- perhaps with live gators and shards of glass -- sounds like something we might see in Jackass 2.5.
It's not for everyone, but if you're Blockbuster, you know you'll be nabbing everyone who wants to see it.
Make it a Foolish night:
What do the unfolding financial crisis and ongoing market volatility mean for your money? The Fool's here with answers. Get the best of our daily commentary and analysis in your inbox simply by entering your email address in the box below.
Terms & Conditions
RSS Headlines
Fool UK