Why do some movies go straight to DVD?

The Straight-to-DVD Strategy

Kids are big fans of direct-to-DVD films (and so are the parents who have a little more quiet time as a result).
Kids are big fans of direct-to-DVD films (and so are the parents who have a little more quiet time as a result).

In the realm of straight-to-DVD releases, films aimed at kids reign supreme. After all, families with young children may be too worried about pinching pennies to splurge on a trip to the movies, but those same families will get great value from a DVD that the kids will watch again and again.

Disney was an early entrant into this market with its 1994 "Aladdin" sequel, "The Return of Jafar." The film cost just $5 million to make yet sold more than 10 million copies in the first six months after its DVD release, eventually netting the company well over $100 million -- not bad for a movie that skipped the theaters and went straight to store shelves [source: Hofmeister]. In a similar vein, the Olsen twins built a billion-dollar empire in the '90s, largely thanks to a series of movies designed for the home market.

Of course, the straight-to-DVD strategy isn't limited to movies with a young audience. It also works well for movies that lack commercial appeal or those that simply won't do well in theaters. Face it: Some films with a delicate or controversial subject matter are simply not designed for the mass market. Sending these films out on DVD allows them to find their niche without the time and expense required to promote them at the box office.

The business model also works well to extend a franchise. While the first few "American Pie" movies made millions in theaters, producers also released a series of straight-to-DVD spin-offs. The third spin-off, "American Pie: Beta House," cost just under $10 million to make but went on to earn nearly twice that amount in DVD sales, despite its lack of familiar characters or big-name actors [source: Nash Information Services].

Finally, skipping straight to the home entertainment market might be another example of the reduced barriers to entry in the modern movie industry. Just as writers can get their work out via self-publishing, filmmakers who lack big-studio support can eschew the main channels and opt for small DVD runs or release on services like iTunes.

A straight-to-DVD release has less to do with quality than it once did. These days, as the lines between big studios and independent producers blur, the DVD remains another means of bringing movies to the masses.

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