Jeffrey Katzenberg: The New Pricing Model For Movies Will Be Based On The Viewer's Screen Size

from the no-it-won't dept

It's been pretty well established that one barrier to movie studios making more money is the silly release windows they apply to their films. As such, you can be sure that many great thinkers and deft minds have been hard at work trying to figure out a new model that will produce just as much coin while nixing the release windows entirely. This article is not about one of those models.

No, this article is about a big bucket of crazy coming from Dreamworks' Jeffrey Katzenberg, who claims that the future business model will be to price out what you pay for a movie based on whatever the dimensions of the screen you're planning to watch it on. Seriously.

Those who watched on a "movie screen" would pay the most while those using smartphones would only pay a small fee, Jeffrey Katzenberg said. This pricing model will be common in 10 years' time, he told a US conference. The pricing model he suggested was $15 (£9) per film for a movie-sized screen, $4 (£2.40) for a 75in (190cm) TV and $1.99 (£1.20) for a smartphone.

This won't happen. I don't mean to say it won't be tried. It might. But it won't last. Why? For a myriad of reasons, not the least of which are the technical hurdles.

The Verge thought the idea faced some technical hurdles.

"Given the diversity of video streaming options available today, it's hard to imagine a security system that would reliably recognise the exact size of the screen it's being displayed on," wrote commentator Vlad Slavov.

And that, frankly, is the least of the reasons why this won't work. Add to that the simple methods for getting around the pricing model (such as hooking up a smart phone to a television screen with a $2 cable), not to mention the simple plain fact that this doesn't make any economic sense. Basing the price of a product upon a physical device that isn't owned by the producer is a bold move. By which I mean it has no basis in established economic theory. Can you imagine iTunes trying to charge you different prices for music based on the size of your speakers? Or video game makers charging more or less based on how much power your computer packs? The product is the product and where it is consumed is the purview of the consumer.

That said, it's nice to see that industry folks are at least coming around to the idea that release windows are going away. I just wish they'd come up with replacement business models that didn't make my head hurt.

Filed Under: business models, jeffrey katzenberg, movies, pricing, screen size