In Fight Over DVD Window, Warner Bros Cuts Off Blockbuster From New Films

Warner Bros. (NYSE: TWX) has refused to give DVD rentals chain Blockbuster (NSDQ: DISH) its latest films, including The Hangover Part II and the final Harry Potter movie, in a row over the 28-day DVD sales window.

The Hollywood studio wants to enforce the industrywide 28-day window between the date new DVDs go on sale and the date they are available to rent.

Blockbuster has resisted efforts to enforce the window, and earlier this year rented retail DVDs of Horrible Bosses and The Green Lantern inside the 28-day window without Warner Bros.’ permission.

The move is the boldest yet by a Hollywood studio trying to revive flagging DVD sales. Physical films sales fell 19 percent year-on-year in the first quarter of 2011 to about £1.3bn, in a period when home streaming through online services such as Netflix and LoveFilm grew rapidly.

Kevin Tsujihara, the president of Warner Bros. home entertainment, indicated in an interview with the Financial Times on Thursday that the studio will next year move to expand the already contentious window.

“[Blockbuster] felt it was important to continue to offer day and date rental, so rather than work with us they went around us,” he told the FT.

“The question is: how do we make ownership more valuable and attractive? We have started the process of creating a window in bricks-and-mortar DVD and Blu-ray rental.”

Warner Bros. has similar 28-day window agreements with the online streaming services Redbox and Netflix (NSDQ: NFLX) in the US.

Tsujihara suggested that those services may have to wait longer to offer film rentals to viewers when talks to renew the agreement begin next year.

“The Netflix and Redbox deals are going to be expiring at the end of the year and beginning of next year and it’s likely we will try to extend those windows,” he told the FT.

The move is likely to be fiercely contested by the rental services, some of which are already feeling the pressure from US broadcasters and studios.

Netflix saw its shares plunge 32 percent, to $79.40 (£49.65), in the past week after it posted a loss of more than 800,000 subscribers and said that next year’s expansion in the UK and Ireland would push it to a global net loss.

Blockbuster had not responded to a request for comment at the time of publication.

This article originally appeared in MediaGuardian.