Warner Video calls for price cuts

One of the country’s leading video distributors, Warner Home Video, is urging video stores to cut the price of new releases to sustain growth in the market.

Michael Heap, managing director of Warner Home Video, says: “The price of videos is too high and needs to come down.”

Heap says that new releases at about 14.99 need to come down to about 9.99, while back catalogue titles should rise to around 7.99 – at the moment prices can be as low as 3.99.

Heap adds: “New releases bring customers into shops. Once they are in, there is the chance to sell them a back catalogue video. What keeps your business growing is people coming into shops. We want to encourage retailers to come round to this way of thinking.”

Warner Home Video is understood to be prepared to consider reducing its own margins, and will arrange meetings with major retailers over the next few weeks to discuss the issue.

A spokesman for HMV, the third largest pre-recorded video retailer in the country, comments: “We are interested in seeing prices come down, but the initiative has to come from suppliers. We need to see lower prices coming from them so we can pass that on to customers.”

Last year, the increase in pre-recorded video sales, at eight per cent, were in single figures for the first time in years. The industry was worth 803m in 1996, according to the British Video Association. It acknowledges it will face strong opposition from new technologies such as Digital Video Disk and digital TV.


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