The biggest film studios have access to libraries of tens of thousands of films and TV titles, but most of them never see the light of day. That is because only a handful of those titles account for the vast bulk of DVD sales. Retailers have little incentive to stock the thousands of less popular titles that make up the rest of studios’ libraries, since it would force them to carry costly and slow-moving inventory. 

HP estimates that there may be $1.5bn-$2bn of untapped opportunity lurking in this long tail of library content. But that could change under a new partnership between HP and Sony, set to be announced on Thursday. Under the partnership, HP will offer content from Sony, manufactured on demand for DVD retailers and wholesalers. The idea is to use HP’s digital technologies to change the economics of DVD distribution. 

While details about specific film titles and retail partners are scarce, the idea is that retailers would be able to use the HP technology to fill single orders of Sony library titles. Meanwhile, video wholesalers would be able to use the same technology to fill smaller orders of less popular films that otherwise would only be economical to press in bulk. 

Eliminating the need to carry inventory should allow retailers to expand the array of titles available in their stores, opening up the long tail of library content to consumers. With Sony now on board with its DVD-on-demand technology, HP will no doubt be looking to strike deals with other prominent studios soon.

January 24th, 2008 in Media | Permalink