In a major coup, pay-per-view programmer In Demand L.L.C. has reached a
video-on-demand output agreement with Universal Studios.
The deal, effective Aug. 1, is the first VOD deal from a major studio for In
Demand and a critical first step toward advancing its efforts to become the
industry's primary VOD-programming supplier.
Neither party would reveal specific terms of the deal, disclosed Friday, but
sources close to the situation said the studio will receive 60 percent of each
VOD purchase. Currently, studios receive about 50 percent of each PPV buy.
'We wouldn't have done a deal that did not make economic sense,' In Demand
executive vice president Rob Jacobson said.
The agreement -- which also includes a renewal of pay-per-view rights --
includes such recent Universal titles as The Family Man and The Mummy
Returns, as well as library fare like The Sting and Do the Right
Thing.
Jacobson called the agreement 'historic' for both In Demand and the cable
industry, which is eyeing VOD as potentially its pre-eminent digital-cable
revenue source.
'It's an important deal for In Demand and an equally important deal for the
industry in that it allows us to provide a consumers access to a studio
on-demand experience,' Jacobson said. 'It also gives cable a product that
differentiates itself from its competitors in the [direct-broadcast satellite]
business.'
Universal Studios Television Distribution senior vice president of worldwide
PPV and VOD Holly Leff Pressman said in a prepared statement that the studio is
'delighted to expand our relationship to now include VOD rights.'
The agreement will also give In Demand PPV windows for Universal product that
are '25 percent' earlier than traditional PPV windows, Jacobson said. On
average, there is currently a 45- to 60-day window between a movie's home-video
and PPV debuts.
Universal's VOD deal with In Demand is not exclusive. In fact, Universal also
has VOD output deals with Intertainer Inc. and Blockbuster
Inc.
