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TOPIC: shrinking window

shrinking window 19 Aug 2005 07:25 #12006

  • leeler
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Tired of being blamed for the box office slump, the nation's movie theater owners returned fire Thursday, accusing the studios of delivering sub-standard product.

"Here's what we know about 2005: The movies are not as good," said John Fithian, president of the National Association of Theater Owners.

"They're not terrible; they're just not as good. And so the industry has experienced a temporary drop-off compared to 2004, the biggest box office year in movie history."

His remarks were part of a direct rebuke to Robert Iger, who is about to take over as CEO of the Walt Disney Co. Iger said last week during the firm's third-quarter conference call that the industry should move toward the simultaneous release of theatrical films and videos. In 2004, the average gap between a film's release in theaters and on video was four months, 16 days.

Fithian said that compressing windows "to placate this instant-everywhere appetite" would result in a world with "no viable movie theater industry ... at least not a theater industry devoted to the entertainment products of Hollywood.

"(Iger) should know that Hollywood studios would be merely one shriveled vendor among many in that new world of movies-as-commodities-only," he added.

Neither Iger nor Disney chose to respond to Fithian's comments.

Year-to-date box office sales stand at $5.57 billion compared with $6.05 billion at the same time in 2004. Pundits have cited exhibitors' pumped-up onscreen advertising, rising ticket prices and rude patrons as primary reasons moviegoers are staying home.

During the earnings call, Iger said, "I don't think it's out of the question that a DVD can be released in effect in the same window as a theatrical release. Although I'm sure we will get a fair amount of push-back on this from the industry, it's not out of the question. I think that all the old rules should be called into question because the rules in terms of consumption have changed so dramatically."

While no major exhibitor has suggested taking aggressive action against Disney based on Iger's comments, theater owners in the past have shown tremendous resistance to anyone who advocates a compressed windows strategy. Many in the industry believe it's just a matter of time until a major studio attempts such an experiment in the hope of reducing marketing costs and maximizing profits across the various platforms.

Reuters/Hollywood Reporter

"What a crazy business"
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Re: shrinking window 19 Aug 2005 08:39 #12007

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It's amazing to me that any studio believes they can "maximize" profits by doing less marketing. If they think that people who go to see their movies in theaters are a completely separate group from those who buy their videos, then I think they will be in for a rude awakening. They will lose the opportunity to get revenue twice from the same person who sees the movie in a theater and then buys it on video later because they liked what they saw.

I believe some people would still want to do both, but many who are impressed by the initial marketing efforts of the studio to sell their film will likely just buy the video and skip the theater experience in an effort to save money and gain convenience.

This would be especially true for family films such as those put out by Disney. If the kids are begging to see the latest Disney film they've seen advertised on TV, and the parent has little interest in the time, effort, and expense it takes to escort the little ones to the theater, what do you think will happen? The kids will likely want it when it comes out on video anyway, so why not kill two birds with one stone?

It will probably cost less, and Mom and/or Dad won't have to see "All Dogs Go to Heaven 6" when they would rather see the latest arthouse film or the rated R feature they would never take their kids to anyway. Or even worse for the theater industry, now Mom and/or Dad can go fishing, biking, wash the car, or whatever instead. I know some parents enjoy seeing the latest kid's feature along with the kids, or don't mind dropping them off at the theater with a ten dollar bill, but I'm guessing there are many who wouldn't do it if it weren't necessary to enable their kids to see it.
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Re: shrinking window 23 Aug 2005 15:14 #12008

  • RonOne50
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The largest video sales is for Finding Nemo and that wasn’t even 150,000,000 and they took in $339,714,367 in US theaters and most that purchased the video had seen it in the theater. So what is going to set up a film to turn the nice profit in the DVD that isn’t in a theater? They do have straight to video release already it is only films that will not make it in the theater!

Quentin: Of course a woman is going to kill me. I wouldn't have it any other way!
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Re: shrinking window 25 Aug 2005 12:31 #12009

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Guys like Iger will further seed the boneyard of film distribs with big ideas that got their heads handed to them by a mega flop. These guys get paid 150 million a year because they're so smart. Smarter than everyone. How about focusing on making better movies. Day and date opening on DVD and theatres will fail. Unless I can just play it for one weekend? Right. That will happen.

Michael Hurley
Michael Hurley
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Re: shrinking window 08 Oct 2005 21:05 #12010

It was recommended that I ask you about your business in a small town and maybe you could give me some advice on my theater-opening plans. If you would like you can read my post "New theater: low income no debt", or email me This e-mail address is being protected from spambots. You need JavaScript enabled to view it . Thank you for any help and advice. Sorry to spam your post.
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Re: shrinking window 12 Oct 2005 18:04 #12011

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Looks like Iger made his first bold move since taking over for Eisner at Disney. This product and what the studios do with it may accelerate the downward trend of movie-going for the 18-24 males discussed on a previous thread. For us oldsters, it's hard to keep up with all of this new technology.


Walt Disney and Apple Computer are to sell episodes of Desperate Housewives and other television shows over an iPod device capable of playing video.

The companies made the announcement on Wednesday at an unveiling of the video iPod in Silicon Valley. The device, to go on sale next week, features a 2½in color screen and can hold up to 150 hours of video as well as music and photos.

The agreement marks a potential milestone in the migration of traditional media to digital distribution devices such as the iPod. It is a development that could further challenge the traditional model of broadcast television and allow consumers to view television, films and other content when and where they choose.

It also represents the first bold move by Robert Iger since he took over as chief executive of Disney on October 1, and demonstrates his vision of using technology to increase sales of the company's prized television and film content. “For the first time ever, prime-time shows can be purchased online the day after they appear on TV,” he said.

Apple shares down despite ‘best quarter’

Strong sales of the iPod portable digital music player and “staggering” demand for the new Nano player helped Apple Computer report surging fourth quarter sales and profits. However, shares fell as revenues fell short of expectations. Go there
Media companies have envisaged a shift towards selling movies, television and other content online in the same way they sell music through iTunes and other digital stores.

However, they have trodden cautiously because of concerns about piracy and cannibalising revenue from other streams, such as DVDs or the television syndication market. There is also the complication of negotiating new digital rights among producers and distributors.

For Apple the launch of the video iPods is expected to give iPod sales a further fillip and consolidate Apple's position as the leader in the market for portable digital content players.

The video players, slightly thinner than music iPods, will come in a 30Gb (gigabyte) and 60Gb model, priced at $299 and $399, respectively. They will be available in black and the iPod's traditional white.

The iTunes store, which will sell music videos for $1.99, has a library of 2,000 offerings, including animated short films from Steve Jobs's other company, Pixar.

Apple has sold more than 28m iPods since their introduction in October 2001 and now has about 75 per cent of the market for digital music players. The success of the hard-drive-based iPod and other digital music devices, including the pencil-sized Nano launched last month, has helped underpin Apple's financial rebound highlighted by the company's strong fourth-quarter results earlier this week.

Apple has continued to improve and refresh the iPod line-up many times since its introduction.
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Re: shrinking window 27 Oct 2005 08:16 #12012

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There's a lot of research out there now that backs up the theory that ancillary sales (DVDs, videos, etc) are driven from box office success. Long story short, big theatre takings means big retail takings. What's more important is that people who don't even see the movie are positively impacted by its success on the big screen.

I highly recommend The Motion Picture Industry: Critical issues in practice, by J. Eliashberg et al, as a great primer. (It's available on the interweb as a PDF.)

Oh yeah, I've missed this place. Its been kind of busy down at the mill, but we've sorted all of that out and now I've got time to invest in my passion. Boo-yah!

I'm out, Zedpha.
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Re: shrinking window 27 Oct 2005 11:32 #12013

Iger sounds like a bigger idiot than Eisner.
Since 1987
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Re: shrinking window 08 Nov 2005 03:03 #12014

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The Incredible Shrinking Movie Window
Ian Mohr,, 06.27.05, 11:55 AM ET

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One side is ready to boycott. Another is making peace offerings.

The topic on everyone's mind but nobody's lips: the incredible shrinking window between a film's theatrical opening and its release on DVD.

The factions--exhibitors, independent distributors and the major studios--don't want to talk about it, but all sides agree: The rules are quickly changing, and something needs to be done--fast.

Last year, studios waited an average of four months and 16 days to release theatrical pictures on DVD. But the window is getting shorter and shorter; one studio chief predicts it could dwindle to just two months, or even fewer for box-office flops.

If the window keeps shrinking, it could rattle the foundations of the film business.

With 2005 box-office receipts trailing those of last year, and consumer electronics companies making rapid inroads into the nation's home-viewing habits, there are rumblings among distributors that the traditional strategies for theatrical distribution, DVD and even pay-per-view, are no longer working.

These concerns are compounded by shifts in the market for DVDs, which now have so short a shelf life, they're disappearing from retail outlets almost as quickly as movies burn off at the box office.

Most of the rumblings are coming from the independent sector, where a handful of maverick distributors are experimenting with plans to release films simultaneously on different platforms. Earlier this year, Mark Cuban and Todd Wagner announced that their 2929 Entertainment had struck a deal with Steven Soderbergh to create six pictures to be rolled out simultaneously in theaters, on cable and on DVD.

Wagner says, "Our premise is that we're trying to increase the revenue pie. It's not an attack on exhibitors, since we believe it's two different audiences (i.e., those who watch a film on the big screen vs. those who do so largely at home). We're trying to rethink how to divvy up that pie."

While it's easy to dismiss Wagner's plan as a maverick experiment, the majors are watching with keen interest, but keeping their opinions close to their vests. One studio flack referred to the topic as an "industry taboo."

"We have a process that works very well," says one studio exec. "Each window generates significant revenue. We have no incentive to change that, unless we see that you can significantly make more money."

Privately, studio execs and filmmakers are wrestling with the traditional strategies. Studios are murmuring that it doesn't make fiscal sense to shell out enormous marketing costs twice for one film. A closer DVD launch can ride the wave that began with the big screen.

Though, as with all booms, the DVD explosion seems to be coming to an end. The format is and will remain the most important source of revenue for studios, but the growth of consumer spending on DVDs is slowing--from a 71% jump between 2001 and 2002 to a more moderate 17.5% this year, according to DVD Exclusive. Much of the new money, though, is coming from the release of TV properties, not films. Absent the tube titles hitting shelves, total DVD growth would likely be in the single digits.

One studio honcho admits that when he and his colleagues see a pay-per-view boxing match earn $55 million to $100 million in one evening, they start talking about simultaneous big screen and PPV launches.

For their part, exhibitors have been bracing for such developments since the video explosion began, and they're not prepared to give any ground.

"It has been our policy that we do not exhibit films that are being simultaneously released on DVD, video or pay TV," says Regal Entertainment Group (nyse: RGC - news - people ) senior vice president of marketing Dick Westerling. "And we do not anticipate changing that policy."

The major circuits are also taking steps to consolidate their power. Last week, AMC Entertainment announced plans to merge with Loews Cineplex, forming the nation's second-largest chain, with 5,936 screens. King of the hill Regal Entertainment has 6,264 screens.

Soderbergh is the perfect guinea pig for 2929, since he bridges two worlds: He has the commercial sensibility that he's shown in studio releases (Erin Brockovich, Ocean's Twelve) along with an independent experimental spirit (Full Frontal and HBO's K Street).

But Soderbergh is also so unpredictable a filmmaker, and it's anybody's guess how he'll focus his creative energies in the months to come. He's planning to direct two studio pictures over the next 12 months--The Good German for Warner Bros., a unit of Time Warner (nyse: TWX - news - people ) followed by a Che Guevara biopic for Focus Features, a unit of Universal Pictures, which is owned by General Electric (nyse: GE - news - people )

But the budget of The Good German has been a source of tension at Warner, home to Soderbergh's small production company Section 8. If he thumbs his nose at exhibitors with a series of low-budget projects financed by 2929, the friction with Warner could heat up.

First up under the deal with 2929 is Bubble, a murder mystery set in Ohio that's finished shooting and is expected to be available for festivals as soon as September.

Company principals say they're not being cagey when they decline to talk about budgets and subject matter: The six-picture pack is an experiment--Bubble even features non-pro actors--and budgets may increase, depending on what happens.

The centerpiece of Cuban and Wagner's plan is the high-definition channel HDNet Movies. But their 2929 has a hand in production (HDNet Films), distribution (Magnolia Pictures) and exhibition (the 200-plus screen Landmark Theater chain).

There is a similar plan afoot at Film Movement, an imprint that distributes films simultaneously in theaters and on DVD through a subscription service. Larry Meistrich, co-founder of New York-based Shooting Gallery, started Film Movement in 2002.

"Exhibitors are helping promote the DVD, and they should at some level find ways to participate (in those profits)," says a Film Movement spokesman.

2929 Entertainment and Film Movement are planning "rebates" to exhibitors. The 2929 documentary Enron: The Smartest Guys in the Room opened simultaneously in theaters and on a high-definition TV channel--and the company plans to reward exhibitors, as thanks for participation in this experiment, by giving them a portion of the ancillary revenue.

There are a lot of unanswered questions about these tactics.

How would it affect word-of-mouth pictures that build slowly, a la Napoleon Dynamite, My Big Fat Greek Wedding or Capturing the Friedmans, which was rolled out through 2929's Magnolia arm?

"A movie like Napoleon Dynamite can run eight or nine or ten weeks in release," says one studio subsidiary exec. "The time that's allowed for these films to reach the windows increases value. If you collapse the windows, can you still do that?"

For 2929's Enron documentary, the company's distribution arm first rolled out the picture in Landmark theaters while airing it simultaneously on the HDNet Movies channel, which is carried by cable providers and satellite services like DirecTV (nyse: DTV - news - people ).

The picture has performed solidly on the HDNet format offered by companies such as Adelphia, Charter Communications ( CHTR) , DirecTV, Dish Network, Insight Communications (nasdaq: ICCI - news - people ), Mediacom (nasdaq: MCCC - news - people ), Time Warner Cable and various National Cable Television Cooperative (NCTC) affiliate.

But the subscription base is not hefty enough to make any dent in the picture's robust theatrical take of $3.2 million.

To optimists, Cuban and Wagner embody the potential for shifts in business plans. They say they want to share the wealth with the exhibitors. They see their plan as a solution to everyone's problems: The money won't be drained from exhibitors but divided with them. (One studio honcho says he hadn't heard of such a plan, but found the idea intriguing.)

Like Cuban and Wagner, those who have the most to gain from such a sea change are up-and-coming entities with burgeoning cable concerns that can use the lure of day-and-date movie preems to get themselves added to more cable systems.

That benefit could far outweigh alienating theater owners and catapult a channel like burgeoning HDNet to a new level.

But there are many independent theaters that are already angry at studios and the bigger chains, feeling shut out by the big boys' deals. These independents would love to get in on the ground floor of something that has such potential--and, as a bonus, to get back at the biggies.

Exhibitors are jumpier than ever, pointing to every action as if it were an omen.

Exhibitors are also irked by studios' re-releasing first- and second-quarter pictures to remind Oscar voters they exist--while the DVD version is already on store shelves.

Take the underperforming Cinderella Man, for example. Universal is reportedly considering a re-release in the fall; the question is whether it would already be available on DVD. October, which Universal is said to be considering as its rollout date, is not a typically strong month for selling home video titles, and the studio could conceivably follow up the re-release with a post-Thanksgiving launch.

"[Exhibitors are looking for what sets] a bad precedent," says one distribution vet. "What that says to studios is that you can shrink windows and get away with it."

Gabriel Snyder in Los Angeles contributed to this report.

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Re: shrinking window 08 Nov 2005 03:11 #12015

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APRIL 8 | SAN FRANCISCO--At its annual gathering in Las Vegas last month, the National Assn. of Theater Owners unveiled its latest compilation of data on the length of the theatrical release window for movies (VB, 4-4).

Unsurprisingly, the study found that the window is shrinking.

Last year, major studio movies arrived on DVD an average of four months and 16 days after their theatrical release. That was 11 days sooner than in 2003 and more than two months faster than a decade ago, when the average was six months, 12 days.

The theater operators lamented the news.

"The shrinking window of theatrical to video does concern us," Regal Entertainment Group theatrical chief Mike Campbell told Daily Variety. "My concern is that if a negative impact occurs, it will be too late to reverse course."

Of course, theater owners complaining about the shrinking theatrical window hardly qualifies as news these days. They've been complaining about encroachment from video since the home video business emerged in the '80s, just as video retailers have been complaining about encroachment from pay-per-view and video-on-demand since those businesses emerged in the '90s.

But the NATO data also contained evidence of another trend in the evolution of release windows that could threaten the margins of all third-party distributors in the movie pipeline equally. Thanks to wider releases and the heavy marketing emphasis on driving opening weekend ticket sales, movies today "play off" much quicker than in the past.

According to the NATO data, films now tally more than half of their total box-office gross within the first two weeks of release. In fact, for the Top 100 grossing films last year, the first three days of release accounted for more than a third of the total.

Five years ago, the average opening weekend represented less than a quarter of a movie's total gross.

The significance to theater owners is that the studios' sliding cut of the ticket sales is highest in the first two weeks of release. So the trend toward quicker play offs means the studios are capturing a higher percentage of all box-office dollars than in the past--at the expense of theater owners.

The elimination of the video rental window with the introduction of DVD has had a similar impact for video retailers.

The studios capture as much as 70% of consumer spending on DVD purchases, compared to 40% or less from spending on rentals. As the elimination of the rental window has shifted consumer spending from rentals to sales, the studios are capturing a higher percentage of total consumer spending on video--at the expense of video retailers.

In other words, the real battle over windows ultimately might be one that pits suppliers against distributors, rather than one distributor against another.

Speaking at the National Cable Show here last week, News Corp. president Peter Chernin left little doubt as to the studios' intentions.

"You're seeing us cannibalizing less valuable windows for more valuable ones," Chernin said. "Secondary and tertiary ad-supported windows are being replaced by earlier, direct consumer purchase windows, because it's much more profitable for us."

Chernin was referring to the vanishing business of licensing movies to broadcast TV. But the logic applies to any window in which a studio licenses a movie to a third-party distributor for use in another business model.

Whether that other model involves selling ads, renting DVDs or selling popcorn and jujubes, it's falling increasingly out of favor with the studios as they seek more direct access to the consumer dollar.

New technologies, such as direct-to-consumer downloads, further promise to whet the studios' appetite for cutting out the middleman. But even where they can't, studios can change the terms of the deal to where some middlemen might just conclude it's not worth the trouble.

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Re: shrinking window 08 Nov 2005 03:15 #12016

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Bubble on three platforms Jan. 31
Soderbergh title among first releases from Magnolia Home Ent.
By Scott Hettrick 11/4/2005
NOV. 4 | Steven Soderbergh’s Bubble--the first film from 2929 Entertainment to be released simultaneously on DVD, in theaters and on TV--will hit market on Jan. 31.

The movie is part of an upcoming slate of DVD titles from Magnolia Home Entertainment, a division of 2929’s Magnolia Pictures set up earlier this year under former Artisan/Miramax exec Randy Wells (VB, 7-1).

First up is Alex Gibney’s Enron: The Smartest Guys in the Room, set to hit DVD on Jan. 17. That will be followed on Jan. 31 by Bubbleand Joseph Castelo’s terrorism thriller The War Within, which hits DVD on the same date.

Magnolia intends to release two to four DVD titles each month.

Bubble is the first of a six-film package to be directed by Soderbergh, shot in high-definition and released simultaneously on disc, in theaters and on HDNet Movies.

“I look forward to maximizing the performance of our titles and establishing Magnolia Home Entertainment as a force in the marketplace,” Wells said.

Other staffers at Magnolia Home Entertainment include Daniel Quantz, director of customer operations; Jay Cohen, director of vendor operations; Christina Mancebo, brand manager; and regional sales managers Renee Brothers, Terry Malone and Bill Marano.

Among the theatrical releases coming through Magnolia’s new DVD unit will be The World’s Fastest Indian with Anthony Hopkins and One Last Thing… with Michael Angarano, Cynthia Nixon, Gina Gershon, Ethan Hawke and Wyclef Jean.

Other titles include Soderbergh’s documentary Spalding Gray: The Last Monologue; two other docs from Gibney, Hunter, a look at Hunter S. Thompson, and Herbie Hancock: Possibilities, which follows the making of Hancock’s latest album; and Hal Hartley’s Fay Grim, starring Parker Posey and Jeff Goldblum.

E-mail Scott Hettrick
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Re: shrinking window 08 Nov 2005 03:17 #12017

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Studios face decline in DVD
Goldman Sachs report predicts fall as soon as next year
By Paul Sweeting 11/3/2005
NOV. 3 | Studios’ DVD income growth might be grinding to a halt.

In a new research report covering Time Warner, News Corp., Disney and Viacom, Wall Street firm Goldman Sachs forecasts no growth in home video profit for the four conglomerates in 2006.

Citing a declining ratio of DVD units sold to box-office gross, the report projects that unit sales will grow only 1.2% next year and will actually decline by 8.2% in 2007. At the same time, DVD’s contribution to total profits at the four companies will fall from 26% in 2005 to 23% next year.

According to the report, Disney has suffered worst among the conglomerates, with home video profits falling 21% in 2005 and expected to drop 7% next year. Fox parent News Corp. saw video profits grow 9% this year but faces a 1% decline in 2006.

Time Warner saw profits up 12% this year but is facing a 1% decline next year, while Paramount parent Viacom saw profits grow 35% this year, to be followed by a 14% increase next year.

Although News Corp. has seen a smaller decline than Disney, it will feel the pinch more acutely, according to the Goldman Sachs analysts, because of its greater dependence on DVD revenue.

Fox generated approximately 35% of total company profits from video in past years and is most exposed next year, with an estimated 30% of profits likely to flow from video.

Disney derived 30% of profits from video from 2003 to 2005 but is likely to see that fall to 18% next year.

Time Warner will go from 30% to 25% next year, while Viacom will go from 16% to 20%.

E-mail Paul Sweeting

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Re: shrinking window 08 Nov 2005 03:21 #12018

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We have nothing at all to fear, Hollywood has a long and honorable tradition of taking good care of exhibitors, and are more than willing to share their profits with us... Please excuse that this is written in crayon; they don't allow me access to anything with a sharp point since I was put in the "home."...

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Re: shrinking window 09 Nov 2005 23:32 #12019

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Exorcism of Emily Rose (Sony) (Theatre Release Date: 09/09/2005; Video Release Date 12/20/2005)

Serenity (Universal) (Theatre Release Date: 09/30/2005; Video Release Date 12/20/2005) (Only 81 days from date of opening)

Into The Blue (Sony) (Theatre Release Date: 09/30/2005; Video Release Date 12/27/2005)

[This message has been edited by muviebuf (edited November 09, 2005).]
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Re: shrinking window 10 Nov 2005 00:46 #12020

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They gotta get 'em on the Wal-Mart shelves to get a piece of that Christmas stocking stuffer money...
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