Warner Bros. is only bidder for Midway Games

Can Warner Bros. find gold in Sumner Redstone's mud?

As The Times' tech blog reports, the studio has emerged as the sole bidder for Midway Games, all but guaranteeing its $33 million offer for the bankrupt publisher of titles including "Mortal Kombat" will soon go through. Midway had been controlled by Viacom Chairman Sumner Redstone until last November, when he sold it at a huge loss to a private investor in exchange for a controversial tax benefit.

Buying Midway would significantly expand the scope of Warner Bros. Interactive Entertainment, the studio's growing video game division. Warner has acquired three game development studios in the past few years and hired industry veteran Martin Tremblay to run the video game unit. It also made an unsuccessful attempt to purchase Eidos, the British publisher of "Tomb Raider" video games.

The most immediate effect of the deal would be that Warner would be able to publish games currently in development at Midway. That includes a new "Mortal Kombat" fighting title and another called "This Is Vegas" set in Sin City. The studio would also gain control of Midway's intellectual property, which includes a number of well known but dormant series like "Joust" and "Spy Hunter" along with "Mortal Kombat." It could not only release new games based on them, but also adapt them for film and television. Warner would also take possession of Midway's development studios in Chicago and Seattle.

As The Times' tech blog explains, there are still several legal hoops Warner and Midway would have to jump through in bankruptcy court before the acquisition can officially close. They include objections to the deal terms from Vin Diesel, whose production company claims it is owed $200,000 by Midway for a game in which he starred, and Larry Kasanoff, producer of the two "Mortal Kombat" movies.

-- Ben Fritz

Photos: Warner Bros. logo. "Mortal Kombat Armageddon." Credit: Midway Games

The major promotion behind the DVD release of Warner Bros.'s summer blockbuster "The Dark Knight" appears to have worked -- at least out of the gate.

The film, which brought in $530 million in ticket sales in the U.S., sold nearly 3 million copies Tuesday, the first day of its DVD release in the United States, Canada and Britain.

"The Dark Knight's" retail reception is reminiscent of first-day sales for "The Matrix" and "Titanic" (any debut of 1 million or more units is considered a home run). At the present rate, "Dark Knight" looks to be on pace to catch Paramount Pictures' "Iron Man," which sold 7.2 million units in its first week on store shelves this year.

Hollywood has been anxiously watching home entertainment sales, as the recession deepens. Sales are off by about 2.6% this year compared to a year ago, according to Adams Media Research, with Blu-ray high definition disc purchases helping to offset some of the decline.

As much as 25% to 30% of the "Dark Knight" discs sold -- or 600,000 copies -- were purchased in the new Blu-ray high definition format. That surpasses the previous record set by  "Iron Man," which sold 260,000 Blu-ray discs upon its first day of release. Studio executives say it's a sign the format is gaining traction with consumers.

"It's encouraging," said Ron Sanders, president of Warner Home Video."The Blu-ray sales of 'Dark Knight' were exceptionally strong and much higher than our projections."

By some accounts, DVD and Blu-ray disc sales outperformed other retail categories. While overall spending on Black Friday was up 3% compared with a year ago, home video sales rose 15%, according to DEG: The Digital Entertainment Group, an industry-supported trade group. (DEG bases its estimates on surveys of retailers, studios and industry data providers).

But Nielsen VideoScan offered a more bleak assessment of Thanksgiving week, reporting that home video sales fell 8.2% compared with a year ago. However, Nielsen's data don't include sales from Wal-Mart Stores Inc., which by some accounts represents 40% of the DVD market.

Retailers did brisk business in Blu-ray players. Researcher NPD Group reported that retailers sold 150,000 players, a 300% increase from a year ago, when two incompatible high-definition disc formats were duking it out for supremacy.

Blu-ray received a tremendous retail boost from Wal-Mart, which reportedly sold out of Magnavox players priced at $128.

-- Dawn C. Chmielewski

Photo: Heath Ledger as the Joker and Christian Bale as Batman in "The Dark Knight." Credit: Stephen Vaughan / Warner Bros.

Hollywood is singing the holiday blues.

Several major studios and consumer electronics companies are bankrolling a $25-million marketing campaign this holiday season to promote Blu-ray movie discs.

The commercials will begin airing this month on television shows and cable channels that attract heavily male audiences (the classic technology early adopter), such as Fox's NFL games and ESPN, Comedy Central and the Discovery Channel.  The ad features some of the summer's biggest hits -- including "The Dark Knight," "Hancock" and "Wall-E" -- together with the promise that "all the movies you want will be on Blu-ray high definition ... The best way to watch movies at home, ever."

The launch of the "Tru Blu" promotional campaign underscores the enormity of the stakes for the studios and hardware manufacturers.  The initial format war over which technology would replace the DVD, Sony's Blu-ray or Toshiba's rival HD DVD, confused consumers and kept them from making the   high-def leap.

Meanwhile, DVD sales, long Hollywood's most dependable cash cow, are down 9% this year, according to Nielsen VideoScan. Studios are looking to promote Blu-ray to pick up the revenue slack.

Admittedly, spurring sales of a premium item as the economy spirals headlong into a recession is no small feat. Especially when a new Consumer Reports poll found that 76% of consumers plan to cut back on holiday spending on gifts, travel and entertaining. 

"With the recession, if people splurge, they’re going to splurge on watching movies at home, bypassing other entertainment options," said Ronald Sanders, president of Warner Home Video Inc.  "Yes, there are some challenges, given the recession. By and large, the industry is holding up very, very well."

The slowing economy appears to be hitting Hollywood where it hurts: at the box office and in DVD sales.

Or maybe it's just that the movies weren't good enough to get people into the theaters.

Either way, several of the major Hollywood studios in recent days have been reporting lower revenues and income.

Time Warner Inc. today said revenue for its Warner Bros. movie division fell 9%, despite the blockbuster Batman sequel "The Dark Knight." Although the movie has grossed $528 million since its July release, even that performance unfavorably compares with a year ago, when "Harry Potter and the Order of the Phoenix," "Rush Hour 3," and "Hairspray"  were in theaters and "300" was out on DVD.

Nonetheless, filmed entertainment was able to squeeze out a 3% increase in operating income, partly owing, however, to cost cuts associated with consolidating its New Line Cinema unit into the larger Warner Bros. studio.

News Corp., meanwhile, reported a 30% drop to $251 million in fiscal first-quarter operating income for its filmed entertainment group, which includes 20th Century Fox. The movies "X-Files: I Want to Believe" and  "The Rocker" drew in fewer theatergoers than the previous year's box-office hits "The Simpsons Movie" and "Live Free or Die Hard."

"The film division admittedly got off to a slow start," said News Corp. Chairman Rupert Murdoch in a call Wednesday with press and analysts. He touted strong holiday offerings, which include "Australia," starring Nicole Kidman and Hugh Jackman, "The Day the Earth Stood Still" staring Keanu Reeves, and "Marley and Me" with Jennifer Aniston and Owen Wilson.

Media conglomerate Viacom Inc. started off the earnings season's economic malaise with its release Monday announcing that Paramount Pictures contributed to the film unit's $19-million loss for the quarter ended Sept. 30. Chief Executive Philippe Dauman said the studio planned to cut back the number of movies it releases each year to no more than 20 to save on marketing costs.

-- Dawn C. Chmielewski

Heath Ledger, as the Joker, with Christian Bale, as Batman, in "The Dark Knight."  Stephen Vaughan / Warner Bros. Pictures

Holy DVD sales, Batman

The major promotion behind the DVD release of Warner Bros.'s summer blockbuster "The Dark Knight" appears to have worked -- at least out of the gate.

The film, which brought in $530 million in ticket sales in the U.S., sold nearly 3 million copies Tuesday, the first day of its DVD release in the United States, Canada and Britain.

"The Dark Knight's" retail reception is reminiscent of first-day sales for "The Matrix" and "Titanic" (any debut of 1 million or more units is considered a home run). At the present rate, "Dark Knight" looks to be on pace to catch Paramount Pictures' "Iron Man," which sold 7.2 million units in its first week on store shelves this year.

Hollywood has been anxiously watching home entertainment sales, as the recession deepens. Sales are off by about 2.6% this year compared to a year ago, according to Adams Media Research, with Blu-ray high definition disc purchases helping to offset some of the decline.

As much as 25% to 30% of the "Dark Knight" discs sold -- or 600,000 copies -- were purchased in the new Blu-ray high definition format. That surpasses the previous record set by  "Iron Man," which sold 260,000 Blu-ray discs upon its first day of release. Studio executives say it's a sign the format is gaining traction with consumers.

"It's encouraging," said Ron Sanders, president of Warner Home Video."The Blu-ray sales of 'Dark Knight' were exceptionally strong and much higher than our projections."

By some accounts, DVD and Blu-ray disc sales outperformed other retail categories. While overall spending on Black Friday was up 3% compared with a year ago, home video sales rose 15%, according to DEG: The Digital Entertainment Group, an industry-supported trade group. (DEG bases its estimates on surveys of retailers, studios and industry data providers).

But Nielsen VideoScan offered a more bleak assessment of Thanksgiving week, reporting that home video sales fell 8.2% compared with a year ago. However, Nielsen's data don't include sales from Wal-Mart Stores Inc., which by some accounts represents 40% of the DVD market.

Retailers did brisk business in Blu-ray players. Researcher NPD Group reported that retailers sold 150,000 players, a 300% increase from a year ago, when two incompatible high-definition disc formats were duking it out for supremacy.

Blu-ray received a tremendous retail boost from Wal-Mart, which reportedly sold out of Magnavox players priced at $128.

-- Dawn C. Chmielewski

Photo: Heath Ledger as the Joker and Christian Bale as Batman in "The Dark Knight." Credit: Stephen Vaughan / Warner Bros.

Hollywood is singing the holiday blues.

Several major studios and consumer electronics companies are bankrolling a $25-million marketing campaign this holiday season to promote Blu-ray movie discs.

The commercials will begin airing this month on television shows and cable channels that attract heavily male audiences (the classic technology early adopter), such as Fox's NFL games and ESPN, Comedy Central and the Discovery Channel.  The ad features some of the summer's biggest hits -- including "The Dark Knight," "Hancock" and "Wall-E" -- together with the promise that "all the movies you want will be on Blu-ray high definition ... The best way to watch movies at home, ever."

The launch of the "Tru Blu" promotional campaign underscores the enormity of the stakes for the studios and hardware manufacturers.  The initial format war over which technology would replace the DVD, Sony's Blu-ray or Toshiba's rival HD DVD, confused consumers and kept them from making the   high-def leap.

Meanwhile, DVD sales, long Hollywood's most dependable cash cow, are down 9% this year, according to Nielsen VideoScan. Studios are looking to promote Blu-ray to pick up the revenue slack.

Admittedly, spurring sales of a premium item as the economy spirals headlong into a recession is no small feat. Especially when a new Consumer Reports poll found that 76% of consumers plan to cut back on holiday spending on gifts, travel and entertaining. 

"With the recession, if people splurge, they’re going to splurge on watching movies at home, bypassing other entertainment options," said Ronald Sanders, president of Warner Home Video Inc.  "Yes, there are some challenges, given the recession. By and large, the industry is holding up very, very well."

The slowing economy appears to be hitting Hollywood where it hurts: at the box office and in DVD sales.

Or maybe it's just that the movies weren't good enough to get people into the theaters.

Either way, several of the major Hollywood studios in recent days have been reporting lower revenues and income.

Time Warner Inc. today said revenue for its Warner Bros. movie division fell 9%, despite the blockbuster Batman sequel "The Dark Knight." Although the movie has grossed $528 million since its July release, even that performance unfavorably compares with a year ago, when "Harry Potter and the Order of the Phoenix," "Rush Hour 3," and "Hairspray"  were in theaters and "300" was out on DVD.

Nonetheless, filmed entertainment was able to squeeze out a 3% increase in operating income, partly owing, however, to cost cuts associated with consolidating its New Line Cinema unit into the larger Warner Bros. studio.

News Corp., meanwhile, reported a 30% drop to $251 million in fiscal first-quarter operating income for its filmed entertainment group, which includes 20th Century Fox. The movies "X-Files: I Want to Believe" and  "The Rocker" drew in fewer theatergoers than the previous year's box-office hits "The Simpsons Movie" and "Live Free or Die Hard."

"The film division admittedly got off to a slow start," said News Corp. Chairman Rupert Murdoch in a call Wednesday with press and analysts. He touted strong holiday offerings, which include "Australia," starring Nicole Kidman and Hugh Jackman, "The Day the Earth Stood Still" staring Keanu Reeves, and "Marley and Me" with Jennifer Aniston and Owen Wilson.

Media conglomerate Viacom Inc. started off the earnings season's economic malaise with its release Monday announcing that Paramount Pictures contributed to the film unit's $19-million loss for the quarter ended Sept. 30. Chief Executive Philippe Dauman said the studio planned to cut back the number of movies it releases each year to no more than 20 to save on marketing costs.

-- Dawn C. Chmielewski

Heath Ledger, as the Joker, with Christian Bale, as Batman, in "The Dark Knight."  Stephen Vaughan / Warner Bros. Pictures

Hollywood sings the Blu(e)s

Hollywood is singing the holiday blues.

Several major studios and consumer electronics companies are bankrolling a $25-million marketing campaign this holiday season to promote Blu-ray movie discs.

The commercials will begin airing this month on television shows and cable channels that attract heavily male audiences (the classic technology early adopter), such as Fox's NFL games and ESPN, Comedy Central and the Discovery Channel.  The ad features some of the summer's biggest hits -- including "The Dark Knight," "Hancock" and "Wall-E" -- together with the promise that "all the movies you want will be on Blu-ray high definition ... The best way to watch movies at home, ever."

The launch of the "Tru Blu" promotional campaign underscores the enormity of the stakes for the studios and hardware manufacturers.  The initial format war over which technology would replace the DVD, Sony's Blu-ray or Toshiba's rival HD DVD, confused consumers and kept them from making the   high-def leap.

Meanwhile, DVD sales, long Hollywood's most dependable cash cow, are down 9% this year, according to Nielsen VideoScan. Studios are looking to promote Blu-ray to pick up the revenue slack.

Admittedly, spurring sales of a premium item as the economy spirals headlong into a recession is no small feat. Especially when a new Consumer Reports poll found that 76% of consumers plan to cut back on holiday spending on gifts, travel and entertaining. 

"With the recession, if people splurge, they’re going to splurge on watching movies at home, bypassing other entertainment options," said Ronald Sanders, president of Warner Home Video Inc.  "Yes, there are some challenges, given the recession. By and large, the industry is holding up very, very well."

The slowing economy appears to be hitting Hollywood where it hurts: at the box office and in DVD sales.

Or maybe it's just that the movies weren't good enough to get people into the theaters.

Either way, several of the major Hollywood studios in recent days have been reporting lower revenues and income.

Time Warner Inc. today said revenue for its Warner Bros. movie division fell 9%, despite the blockbuster Batman sequel "The Dark Knight." Although the movie has grossed $528 million since its July release, even that performance unfavorably compares with a year ago, when "Harry Potter and the Order of the Phoenix," "Rush Hour 3," and "Hairspray"  were in theaters and "300" was out on DVD.

Nonetheless, filmed entertainment was able to squeeze out a 3% increase in operating income, partly owing, however, to cost cuts associated with consolidating its New Line Cinema unit into the larger Warner Bros. studio.

News Corp., meanwhile, reported a 30% drop to $251 million in fiscal first-quarter operating income for its filmed entertainment group, which includes 20th Century Fox. The movies "X-Files: I Want to Believe" and  "The Rocker" drew in fewer theatergoers than the previous year's box-office hits "The Simpsons Movie" and "Live Free or Die Hard."

"The film division admittedly got off to a slow start," said News Corp. Chairman Rupert Murdoch in a call Wednesday with press and analysts. He touted strong holiday offerings, which include "Australia," starring Nicole Kidman and Hugh Jackman, "The Day the Earth Stood Still" staring Keanu Reeves, and "Marley and Me" with Jennifer Aniston and Owen Wilson.

Media conglomerate Viacom Inc. started off the earnings season's economic malaise with its release Monday announcing that Paramount Pictures contributed to the film unit's $19-million loss for the quarter ended Sept. 30. Chief Executive Philippe Dauman said the studio planned to cut back the number of movies it releases each year to no more than 20 to save on marketing costs.

-- Dawn C. Chmielewski

Heath Ledger, as the Joker, with Christian Bale, as Batman, in "The Dark Knight."  Stephen Vaughan / Warner Bros. Pictures

Slowing economy, or something, hits studios

The slowing economy appears to be hitting Hollywood where it hurts: at the box office and in DVD sales.

Or maybe it's just that the movies weren't good enough to get people into the theaters.

Either way, several of the major Hollywood studios in recent days have been reporting lower revenues and income.

Time Warner Inc. today said revenue for its Warner Bros. movie division fell 9%, despite the blockbuster Batman sequel "The Dark Knight." Although the movie has grossed $528 million since its July release, even that performance unfavorably compares with a year ago, when "Harry Potter and the Order of the Phoenix," "Rush Hour 3," and "Hairspray"  were in theaters and "300" was out on DVD.

Nonetheless, filmed entertainment was able to squeeze out a 3% increase in operating income, partly owing, however, to cost cuts associated with consolidating its New Line Cinema unit into the larger Warner Bros. studio.

News Corp., meanwhile, reported a 30% drop to $251 million in fiscal first-quarter operating income for its filmed entertainment group, which includes 20th Century Fox. The movies "X-Files: I Want to Believe" and  "The Rocker" drew in fewer theatergoers than the previous year's box-office hits "The Simpsons Movie" and "Live Free or Die Hard."

"The film division admittedly got off to a slow start," said News Corp. Chairman Rupert Murdoch in a call Wednesday with press and analysts. He touted strong holiday offerings, which include "Australia," starring Nicole Kidman and Hugh Jackman, "The Day the Earth Stood Still" staring Keanu Reeves, and "Marley and Me" with Jennifer Aniston and Owen Wilson.

Media conglomerate Viacom Inc. started off the earnings season's economic malaise with its release Monday announcing that Paramount Pictures contributed to the film unit's $19-million loss for the quarter ended Sept. 30. Chief Executive Philippe Dauman said the studio planned to cut back the number of movies it releases each year to no more than 20 to save on marketing costs.

-- Dawn C. Chmielewski

Heath Ledger, as the Joker, with Christian Bale, as Batman, in "The Dark Knight."  Stephen Vaughan / Warner Bros. Pictures