- February 13, 2012
- Posted by: Kauser Kanji
- Category: Strategy
What’s the difference between the first and second pay windows? And what about the Buy vs. Rental window? Here’s the lowdown.
We’ve been hearing a lot about “pay windows” over the past few months. For example, in August last year the Competition Commission provisionally concluded that Sky’s control of pay-TV movie rights was having an adverse effect on competition. Sky, as you know, currently has a lock on the “first pay” window. In other words, it has exclusive agreements with all of the major studios (except StudioCanal and Entertainment One) that allows it to be the first subscription service to offer new movies you can watch on television (and PC / tablet) at home.
At the same time both Lovefilm and Netflix have been doing deals with the studios so that they can stream TV shows and films in the “second pay” window – around 6 months after the first pay window. And in the US, some companies like DirecTV, have experimented with “premium VOD” windows that, for the same price as 2 cinema tickets, let you watch a brand new movie – which is still on theatrical release – at home.
Lines are blurring and the terminology can get confusing so here’s our first-draft guide to pay windows for TV and movies in some sort of chronological order.
1. The “Theatrical” Window
This is nice and straightforward. Or at least it used to be before premium VOD was introduced. The theatrical window is simply the time when a movie can be shown in a theatre. Depending on the film itself, the studio that made it and agreements that the distributors have struck, a movie normally plays in a cinema for between 4 – 8 weeks.
2. The “Airplane / Hotel” Window
Did you think that the DVD window would come straight after the theatrical window? I did. But no, after ‘theatrical’ comes the Airplane / Hotel window – a time when you can watch movies that are sometimes still on at the cinema, on a flight or in a hotel room. Again, depending on the distribution deal, airlines and hotel chains can ‘broadcast’ (aircast? leisurecast?) TV shows and movies within a week of theatrical release.
3. The “DVD Buy” Window
The DVD Buy window is, as the name suggests, the time when you can buy the DVD of a movie that was lately on at the theatre. Or one that was so terrible it bypassed the cinema altogether. The latest Sherlock Holmes movie starring Robert Downey Jr. And Jude Law, for example, will be available to buy on 14 May 2012. The ‘DVD Buy’ window normally opens between 3 to 6 months after theatrical release.
4. The “Rental” Window
You might think as soon as a DVD is available to buy you’ll be able to get down to your local Blockbuster and pick it up for rent immediately. But again, this isn’t the case. And once again it’s all down to the distribution agreements that have been made. DVDs can become available for rent usually between one and four weeks after the ‘Buy’ window opens.
5. The “Pay-per-View” Window aka TVOD (Transactional Video-on-Demand)
Ever watched a movie on Sky Box Office, Lovefilm Box Office, Blinkbox or Acetrax? If so, you’ve used TVOD – you’ve paid (made a single transaction) to rent a movie to view online or via IPTV. The pay-per-view window that allows for TVOD is distinct from the ‘Rental’ window in that it doesn’t involve renting a physical asset like a DVD / Blu-ray disc. The PPV window normally opens within weeks of the rental window.
6. The “First Pay” Window aka the “Sky” Window aka SVOD (Subscription Video-on-Demand)
The first pay window is the first time a movie can be shown on a consumer platform (television, computer, tablet, mobile) to subscribers of a given service – in the UK, that’s currently Sky for films from all studios except StudioCanal and Entertainment One who have exclusive deals with Lovefilm. Different to TVOD (you’re not paying one movie at a time), the first pay window normally opens around 6 months after theatrical release.
7. The “Second Pay” Window
Not so long ago there was no such thing as video-on-demand. You either watched a movie at the cinema or waited till it was on video / DVD, or waited again until it came to Sky or finally, waited again until the film was on regular television around Christmas time two years later. This delay between a movie airing on Sky versus airing on terrestrial TV was a big gap that distributors happily found they could fill with the second pay window – the time when you can watch a film, on demand, online and on a platform of your choice. If you’ve ever used Lovefilm – or now Netflix – in the UK, you’ve encountered the second pay window. In theory everyone wins here – consumers gets films a little bit faster, studios get paid for another round of distribution.
8. The “Terrestrial” Window
The movie, having been marketed to death in all of the previous windows, now finally arrives on regular television. It’s been two years since it was on at the cinema. Enjoy!