Warner Bros. to Rent DVD Players and Flicks

On April 13, Warner Bros. Home Video announced a program intended to introduce the DVD to a new generation of movie fans. WB will bundle DVD players and discs for video dealers to rent to their customers. "The rapid growth of DVD now makes rental a viable business opportunity for rental retailers," says Thomas Lesinski, Warner Home Video senior vice president for marketing.

The plan to provide players parallels the early days of VHS, when VCRs were relatively expensive, and video rental outlets stocked machines in travel cases for customers without them. Now that a basic VCR is available for well under $150, its market penetration is almost as widespread as the television itself, and VCR rental is no longer commonplace.

More than 1000 movie titles have been issued by the major movie studios since DVD's introduction just over a year ago, but most rental dealers stock only a handful of them. Warner Bros. is hoping their machine-and-disc program will bring VHS tape fans into the DVD fold. In both picture and sound, DVD's superiority over tape is obvious even on an ordinary television set.

Until now, owners of DVD machines have been primarily purchasing titles rather than renting. Discs are typically priced at around $20 each. Recently, several studios have pushed prices toward $30 per title, a development that some observers think could tip the scale in favor of Divx. Warner Bros. Home Video's Warren Lieberfarb has long been one of the industry's most outspoken critics of the pay-per-view Divx scheme, which will begin nationwide later this summer.

By giving consumers a low-cost introduction to the "open format" at the same time, WB hopes to put a serious damper on the Divx debut. According to a WB spokesperson, prices and details on the rental program will be announced later.