Image and Criterion

The scuttlebutt on Criterion, Eclipse, and Janus Films. Lists and polls are STRONGLY discouraged.
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dx23
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Image and Criterion

#1 Post by dx23 » Tue Aug 02, 2005 11:31 am

IMAGE GAINS CRITERION As part of Home Vision acquisition
By Scott Hettrick 8/2/2005

AUG. 2 | DVD distributor Image Entertainment has acquired 19-year-old Chicago-based publisher/distributor Home Vision Entertainment.

The $8 million deal--one of the largest ever for Chatsworth, Calif.-based Image--also gives the former laserdisc company exclusive distribution rights to the prestigious Criterion Collection of esoteric, foreign and critically acclaimed movies on DVD.

For the past eight years, Image had split retail distribution of Criterion titles with Home Vision, which had a separate 50/50 joint venture with Criterion. With that arrangement, Image was never able to include Criterion titles in its overall national marketing efforts.

With this week's deal, Home Vision sells its 50% stake in the joint venture back to Criterion, freeing up Criterion to sign an exclusive output deal with Image for its 280 active catalog titles and three to four monthly new releases through 2010.

Image will now be able to mount full-fledged marketing campaigns for DVDs from Criterion, which is credited with creating the market for today's DVD bonus features and audio commentaries when the company first produced those features for laserdiscs in the '80s. Criterion licenses selected titles such as The Life Aquatic and Hoop Dreams from studios and producers, paying a royalty fee that is often comparable to the wholesale price realized by suppliers on the titles. The Criterion Collection contains approximately 280 active DVD titles in its library and typically releases three or four new titles each month.

The privately held Home Vision, which specializes in independent and foreign films on DVD such as the BBC production of The Chronicles of Narnia, the animated classic Animal Farm, Allegro Non Troppo and the George C. Scott starrer The Day of the Dolphin, had net revenue of $29 million last year on more than 130 active titles, according to the companies.

With the acquisition of all outstanding capital stock, Image is expected to eventually lay off about 40 of Home Vision's 45 employees and shutter Home Vision's Chicago headquarters and warehouse facility, consolidating those operations into its newly renovated facilities by the end of the year.

Home Vision's president and CEO, Adrianne Furniss, will remain as a consultant for three years, assisting with Image's consolidation and content acquisition efforts. Others will likely come from Home Vision's acquisition and production areas.

The Home Vision Entertainment name will remain as a label under which Image will continue to release new titles on a monthly basis.

Image execs believe the deal will allow the combined companies to realize at least $2 million in cost savings.

Image COO David Borshell said the company intends to use the deal as a springboard to make additional acquisitions, perhaps further expanding its re-entry into the fine arts and foreign film category as well as others.

"We have a physical and personnel infrastructure that we are in a great position to leverage," Borshell said.

"Now that the transaction has been concluded, we plan to intensify efforts to identify and pursue further opportunities," said Image president and CEO Martin Greenwald.

Criterion president Peter Becker said, "After well over a decade's experience with us and our brand, Image understands what The Criterion Collection means, both to our core customers and to the retailers who help us reach a wider audience."
The good thing this could mean is that Criterion could now be releasing Odd Man Out and Dr. Mabuse The Gambler.

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Gary Tooze
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#2 Post by Gary Tooze » Tue Aug 02, 2005 11:33 am

As of August 1st, circa 3 pm, Home Vision as we all knew it ceased to exist. Home Vision will now be a "specialty label" owned and operated by Image Entertainment. Image will be closing the Chicago location to "consolidate" Home Vision's label to their corporate offices in California.

As to what this means besides a lot of unemployed cinephiles and heartbreaks remains to be seen. Image is contractually obligated to release any future Home Vision titles that where already in the works or which had already been contracted. Image's "lenient" quality control will certainly play a part in any future "Home Vision" release so beware.

Criterion remains an independently owned company. This deal formalizes a 100% distribution deal between Image and Criterion lasting through the end of 2010. More to follow as we find out.

Will post more here updates:

http://www.dvdbeaver.com/

Best,
Gary

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#3 Post by Tribe » Tue Aug 02, 2005 11:36 am

Wow. This is really important news. Dreadful to think about the lack of attention that Image will devote to HVE titles. This is potentially a real shame.

I mean, just compare their websites...

It will be interesting to see how this impacts on Criterion, although Criterion and Image have also had a long-standing relationship.

Tribe

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dx23
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#4 Post by dx23 » Tue Aug 02, 2005 11:42 am

I just posted the news a couple of minutes before Gary on the Criterion section of the forum because of an article that i just read on dvdexclusive.com. Here is the link to the article that somewhat explanis what Gary just said:
http://www.dvdexclusive.com/article.asp?articleID=2298

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#5 Post by Tribe » Tue Aug 02, 2005 12:22 pm

Thanks for the link, dx. Becker doesn't appear to be terribly concerned about it. Perhaps it's not a big deal.
Criterion licenses selected titles such as The Life Aquatic and Hoop Dreams from studios and producers, paying a royalty fee that is often comparable to the wholesale price realized by suppliers on the titles.
What does this mean?

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#6 Post by rwaits » Tue Aug 02, 2005 12:23 pm

Double Indemnity please.

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#7 Post by FilmFanSea » Tue Aug 02, 2005 12:25 pm

dx23 wrote:With the acquisition of all outstanding capital stock, Image is expected to eventually lay off about 40 of Home Vision's 45 employees and shutter Home Vision's Chicago headquarters and warehouse facility, consolidating those operations into its newly renovated facilities by the end of the year.

Home Vision's president and CEO, Adrianne Furniss, will remain as a consultant for three years, assisting with Image's consolidation and content acquisition efforts. Others will likely come from Home Vision's acquisition and production areas.

The Home Vision Entertainment name will remain as a label under which Image will continue to release new titles on a monthly basis.
This part sounds like potentially tragic news. Appears that Image will be dissolving the HVE creative team and remaking the label in its own Image [sorry]. That will almost certainly mean a change of direction for HVE, though, on the up side, Image may have better financial resources to expand acquisitions.

Did Adrianne Furniss sell out [figuratively, I mean]? Or was the HVE business model not working?

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#8 Post by Tribe » Tue Aug 02, 2005 12:27 pm

Did Adrianne Furniss sell out? Or was the HVE business model not working?
On the DVDBeaver listserve, the skinny was that in light of continuing consolidation in the industry, as well as issues concerning BluRay (or whatever ya call it) and hi-def formatting, they essentially wanted to get out now while the going was good.

And, of course, I'm paraphrasing.

Tribe

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#9 Post by analoguezombie » Tue Aug 02, 2005 1:02 pm

I'd say this directly relates to the rumors circulating about Criterion creating its own 'cult' spin-off label Eclipse. Image is at the bottom of the barrel.

Ugh, dvd quality wil continue to flounder I fear.

So wil, Image only handle marketing and distribution or will they have a hand in the decisions at Criterion?

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#10 Post by ByMarkClark.com » Tue Aug 02, 2005 1:06 pm

I think I now understand what's behind the delay in launching the new Eclipse imprint!

I'm also worried about what this means for the future of the CC. Hopefully, Image will do the smart thing and let Criterion keep on doing what it's doing, with a minimum of corporate meddling. If Image tries to take over the show, the CC is in big trouble.

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#11 Post by Lino » Tue Aug 02, 2005 1:11 pm

I always like to look on the bright side and for me this news isn't all that bad - I mean, there has to be something good out of all this, right?

So, I would like to think that this deal will mean that Criterion and HVe will eventually add more great titles to their already fantastic catalogues without having to go through all that distribution-rights-buying nuisance.

One thing that I personally would like to see is the price of future Criterion titles get a little lower (as in, CHEAPER!).

I guess we all have to wait and see what this will bring. Come to think of it, this is now the second BIG news this year concerning companies buying off other companies: first Sony buys MGM and now Image adds HVe to their "empire".

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#12 Post by Mathieu » Tue Aug 02, 2005 1:26 pm

I always like to look on the bright side and for me this news isn't all that bad - I mean, there has to be something good out of all this, right?
...a Criterion edition of Caligula? I'm serious.

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#13 Post by Matt » Tue Aug 02, 2005 1:56 pm

There's gonna be a webcast conference call discussing the acquisition on Thursday:

http://phx.corporate-ir.net/phoenix.zht ... ID=1113165

You can read Image's press release re: the acquisition here:

http://phx.corporate-ir.net/phoenix.zht ... &id=738374&

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#14 Post by Michael Kerpan » Tue Aug 02, 2005 2:00 pm

This is NOT going to be a good thing for DVD consumers (though not so bad for us as for the 40 -- out of 45 -- employees losing their jobs).

Now -- if Image had acquired New Yorker, I'd be feeling different about all this.

;~{

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#15 Post by dx23 » Tue Aug 02, 2005 2:37 pm

Quote:
Criterion licenses selected titles such as The Life Aquatic and Hoop Dreams from studios and producers, paying a royalty fee that is often comparable to the wholesale price realized by suppliers on the titles.

What does this mean?
I think that the writer got a little confused on who owns what. He probably was explaining the way the Criterion company works on acquiring the license of a film and the way they pay the studio that owns it in a royalty fee.

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#16 Post by foofighters7 » Tue Aug 02, 2005 2:54 pm

This is indeed interesting news. I think it could go either way really. If they understand a large reason people buy HVE or Criterion titles is because of quality, and lowering quality will cripple them, they will continue to keep things right. Becker seems to think Image understands what Criterion stands for (at least in the press statement).

One good outcome of this could be lower prices. And of course more great titles into the collection.

I personally think this will indeed lower the prices of Criterion,( of course they seem to already have changed the pricing anyways) which will make them more marketable. They mentioned that they wanted to do a large marketing campaign, and of course lower prices will help in that endevor.

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#17 Post by neuro » Tue Aug 02, 2005 3:19 pm

Q: What does a devotion to quality, Criterion-level releases (with half the prices) get you?


A: About 40 layoffs. It's business, asshole.


I hope that everyone at both the still-active Facets and New Yorker labels chokes a little today.

*****

In "what's in it for me?" news, I will hold Image to this statement:
"Image will do everything possible to represent the Home Vision Entertainment label with the same passion and commitment that suppliers and customers have come to expect. Everyone at Home Vision should be proud of their company's 19 years of accomplishments."
We'll see what Thursday brings, I suppose.

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#18 Post by cdnchris » Tue Aug 02, 2005 3:32 pm

Will it really change prices? I don't know about the States but I think the Image DVDs can still go for a pretty penny in Canada. I still forked over $60 for their Stalker DVD (and have been kicking myself in the nuts ever since, which isn't easy to do I tells ya.)

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#19 Post by Ashirg » Tue Aug 02, 2005 3:38 pm

Image is not just a releasing company, they are also distributing company. For example, they distribute titles from Ruscico in U.S. and don't set up their prices (thus, this high Stalker price). And here's a real shocker - they've been distributing Criterion titles for a long time. Home Vision was another distributor of Criterion.

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#20 Post by Michael Kerpan » Tue Aug 02, 2005 3:40 pm

Somehow I don't think it is the LABEL that provides quality -- or "passion and commitment". I would assume that the reason HVE provided well-chosen, well-made DVDs was the people standing behind the name. And now, these people are unemployed. Image bought a catalog and a name -- but is throwing the business operation (and the people) that created both away.

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#21 Post by Cinéslob » Tue Aug 02, 2005 3:41 pm

"Image will do everything possible to represent the Home Vision Entertainment label with the same passion and commitment that suppliers and customers have come to expect. Everyone at Home Vision should be proud of their company's 19 years of accomplishments. In fact, we're so proud of them, we're going to fire just under 90% of them in a mealy-mouthed exercise in slash-and-burn economics!"
Last edited by Cinéslob on Tue Aug 02, 2005 4:01 pm, edited 1 time in total.

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#22 Post by Michael Kerpan » Tue Aug 02, 2005 3:53 pm

> In fact, we're so proud of them, we're going to fire just under
> 90% of HVE's staff in a mealy-mouthed exercise in slash-and-burn
> economics!"

When my little brother sold the business HE created to a big corporation, he made sure all his employees were taken care of.

It sure seems like the owners of HVE are pigs.

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#23 Post by Cinephrenic » Tue Aug 02, 2005 4:09 pm

I hope they lay off that secretary I talked to a few months ago. 8-)

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#24 Post by Andre Jurieu » Tue Aug 02, 2005 4:12 pm

Michael Kerpan wrote:It sure seems like the owners of HVE are pigs.
And of course we're making statements such as this with complete knowledge of what HVe is doing for their laid-off employees. I believe the managers are also pouring sugar in the gas tanks of the employees' cars and knocking up their little sisters, you know, because anyone associated with managing a business that we don't know personally is an total selfish asshole.

Has anyone other than Ashirg read the release and articles? Image has no claim over Criterion's day-to-day business operations. They only have a contract for distribution which they have been doing for years. It's just exclusive now because they have acquired the other distributor and thus created a new contract. They may have more influence on the distribution of the product, but it's pretty much just pure speculation regarding the level of influence they have regarding the creation of the product itself.

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#25 Post by Michael Kerpan » Tue Aug 02, 2005 4:20 pm

Yes, Mr. Jurieu -- I did read the articles --

I'm not talking about Criterion, I'm talking about HVE. I'll worry about Criterion's staff if/when they get their company sold out from under THEIR feet.

I'm glad you are SO sympathetic to the tender feelings of the (former) owners of HVE, I'm certain it hurt them terribly to have to pink-slip their whole staff.

Sheesh.

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