Image and Criterion

[THX1378]

Image has no claim over Criterion's day-to-day business operations.

Thats what I thought. I was under the understanding that Criterion was it's own company outright and that Home Vision just distributing Criterion's DVDs. If so I would say that all Image got was whatever deal of distributing that Home Vision was doing with Criterion and thats all. One good thing that could come of this is that some of the films Image owns like Dr. Mabuse The Gambler could become a part of the collection easily now. I'm wondering if Image now is going to hold off on Blood for Dracula and Flesh for Frankenstein and let it be part of the collection again.

[Michael Kerpan]

A refresher on the confusing links between Criterion and HVE and Janus .....

http://en.wikipedia.org/wiki/Criterion_Collection

[Tribe]

I never felt any concern regarding Image and Criterion...like someone else pointed out, Criterion and Image have had a business relationship for quite some time. My main concern is HVE, which in my book was second (or third perhaps) to Criterion and Warners in terms of titles and quality. I'm not that certain that we'll continue to see that. On the other hand, Image has released many so-called art-house films and its catalog in this regard reads like a who's who of outstanding World Cinema auteurs.

In terms of quality, Image hasn't devoted much to that, but, at the same time, they have maintained reasonable prices on their releases (as opposed to Kino which charges Criterion prices and often offers quality much worse than anything that has come out of Image's vaults).

Since Image is retaining Furness, perhaps they do intend to continue what HVE was doing in seeking out worthy World Cinema releases.


Tribe

[Andre Jurieu]

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.

First paragraph was addressing your comment. Second paragraph was a general comment regarding the prevalent notion that Image has some degree of control over Criterion. Therefore, the second paragraph is not directly addressing your comments regarding owners acting like pigs, or whether or not you specifically have read the article/release.

I'm not asking you to worry about Criterion. I'm saying we shouldn't start scolding the people involved without any inner knowledge of the situation and just based on our own conceptions of what business deals are like and the idea that everyone involved in negotiating the deal is heartless. I never said I had "tender feelings" for the high-level parties involved or that the former owners of HVe should receive our sympathy for their troubles. What I am saying is that it's reductive to say that owners are pigs for making a business deal, as if they have no compassion whatsoever for what is happening to their employees.

How do we know that HVe just surprised their employees this morning with pink-slips, or that they haven't done anything for their employees? Do we know for sure that they just kicked them all out of the office this morning? Do we know whether they attempted to relocate some of the most loyal employees? We don't know anything about HVe's internal procedures for handling this deal, but for some reason we just assume they were heartless because they are running a business. If someone could give me some proof that the owners just handed everyone a bunch of pink-slips this morning, without severance packages, and started lighting up their cigars with $100 bills to celebrate, (or some similar scenario) then I would be more inclined to believe these people are pigs.

As far as I know this is a business deal, and it's unfortunate that some people had to lose their jobs, and I'm sure it will be difficult on their families, and I sympathize with them because I've had to go through the same situation during my life, but such are the realities of life. People lose jobs in a society that focuses around commerce, but its not like these folks are all unskilled employees that the industry has passed by, or worse, the industry itself has been passed by. I just don't enjoy the fact that we just assume the worst about the people involved without knowing very much about the scenario. This is a 45 person corporation, and within such a small dynamic, you would be surprised how close the personal relationships often are within such a small hierarchy. Maybe the guy at the very top didn't shed a tear for the guy in the mail-room, but I'm sure a few managers and employees were rather disheartened that things were coming to an end and were worried about the fact that a friend was losing their job.

[Michael Kerpan]

Furniss (not Furness)

I think other staff people were involved with acquisition research, however.

[Tribe]

How do we know that HVe just surprised their employees this morning with pink-slips, or that they haven't done anything for their employees? Do we know for sure that they just kicked them all out of the office this morning? Do we know whether they attempted to relocate some of the most loyal employees?

Actually, according to the initial message posted to the DVDBeaver listserve by a frequent poster employed by HVE, it sure sounded like it was exactly like that...a surprise, which is how these things happen. As I understood the message, there were Image people in Chicago this morning making arrangements to transfer the inventory.

Tribe

[Andre Jurieu]

Thank you Tribe. Well, if that's the case, then at least there is some basis for the claim, but it seems rather premature to say HVe will not be accommodating some of their employees in some manner. These things often happen abruptly, but they don't always happen without consideration.

[Tribe]

I'm sure that the muckety-mucks in suits will receive some severance and consideration. Don't count on it for the lower echelon of clerks, secretarial and the like. If anything, those folks might get a pittance of something...in exchange for a release of any and all claims against the company, of course.

I see it happen every day...

Tribe

[peerpee]

Laid off staff might get severance pay of some returned YAKUZA PAPERS metal boxes that they can melt down for scrap prices.

[Matt]

I, for one, am not sad to see the guy in charge of sending out review copies go. You'd think you were asking the guy to give you one of his own teeth by asking for a review copy.

Oh, and if you want to read the SEC filing on the acquisition, it's here. Hot stuff. $8 million in cash, a $0.5 million golden parachute "consulting" deal for Furniss.

[analoguezombie]

Any dvd company that lists 'Foriegn' as a genre is suspicious to me.

I'll bet Image is trying to move more heavily into the Cineaste dvd market by merely utilizing the name 'HVe' and none of their tactics etc...

When it comes down to making a definite profit off each release instead of putting tons of effort into restoration for the sake of it, and using the success of better known titles to offset costs, fans like us are in trouble. How can you justify spending $300,000 for restoration of a movie that's virtually unknown outside of its own country to a board of directors? Criterion and HVe have been moderately successful b/c their owner/operator have a passion for the films they release. They know their audience and are willing to take risks on some releases. But even the risky releases get the same love and attention that something like a Kurosawa film does.

I just expect to see HVe's quality suffer, and for it spread to CC since they'll be dealing with a singular marketing/distribution company who will no doubt have much more power than in the current set up.

Much like the big studios dvds lately, I expect the smaller houses to begin scaling back quality extras. The golden age of dvd is over. Bring on HD-DVD and BluRay

[dx23]

Another article with a little more detail about the acquisition from Home Media Retailing:
http://videostoremag.com/news/html/brea ... le_ID=7843

[quote]Image Acquires Home Vision
Author: THOMAS K. ARNOLD
[email protected]
Posted: August 2, 2005

Image Entertainment Monday announced it has bought Home Vision Entertainment, a Chicago-based specialty supplier of independent and foreign films. In connection with the $8 million cash deal, Image also negotiated exclusive distribution rights to the prestigious Criterion Collection for the next five years.

Image, a Chatsworth, Calif.-based producer and distributor of home entertainment, has a domestic catalog of more than 2,800 exclusive DVDs and 175 CDs.

Also on Monday, Image lowered its first-quarter 2006 revenue guidance to between $18 million and $19 million for the quarter ending June 30. Previously the company had announced revenue guidance of between $19 million and $21 million. Image also said it is not adjusting previously announced annual revenue guidance of between $110 million and $120 million. An investor conference call will be held Aug. 11.

With the acquisition of all of the outstanding capital stock of Public Media Inc., Image becomes the new owner of Home Vision, with a library of more than 130 active titles, including The Day of the Dolphin, the 1973 film with George C. Scott, and the BBC productions of C.S. Lewis' classic The Chronicles of Narnia.

Image also becomes the sole retail source of titles from Criterion, the industry's major source of high-end special-edition DVDs. Criterion has about 280 active DVD titles in its library, mostly acclaimed classic and contemporary films, and releases three to four new titles a month.

Previously, Image shared distribution of Criterion titles with Home Vision, each servicing its own retail lists.

Image COO David Borshell noted that this is Image's first acquisition of an independent video company and the company's first acquisition since the 1999 purchase of online retailer DVD Planet.

“This is extremely important to Image in our strategy to grow the company,â€

[analoguezombie]

how many times can they refer to 'revenue' in one press release? we get it, it's ALL completely about adding to Image's revenue. Like I said, say goodbye to quality restorations and tons extras for marginal titles.

[Tribe]

Any dvd company that lists 'Foriegn' as a genre is suspicious to me.

So, I take it that your suspicions have you looking over your shoulder evry time you enter a retail establishment to purchase a DVD?

If you're that scared...but a dog.

Tribe

[Tribe]

I think that $8 million for HVE and the distribution rights for Criterion is a steal by Image, especially as a short term investment. The tricky part would be on 2010 when the re-negociations for distribution rights of the Criterion label take place.

Yeah, I think so too. Very nice deal...particularly when you consider that HVE drew in net around $18 million in revenue. And by 2010 there should be some stability regarding what the new standard for HI-DEF DVDs will be.

Tribe

[Poncho Punch]

I miss the old days, when we used to bicker like children about films and filmmakers.

[dx23]

how many times can they refer to 'revenue' in one press release? we get it, it's ALL completely about adding to Image's revenue. Like I said, say goodbye to quality restorations and tons extras for marginal titles.

I don't think Image is that stupid to loose quality over revenue. They must know the fanbase of HVE, and they must know that you don't want to piss them off by releasing mediocre DVDs of "marginal titles". If they do, then they are not going to have much of that "revenue" of which they keep talking about.

[FilmFanSea]

how many times can they refer to 'revenue' in one press release? we get it, it's ALL completely about adding to Image's revenue. Like I said, say goodbye to quality restorations and tons extras for marginal titles.

Since Image is a publically traded company, all of that optimistic talk about "revenue" is there to reassure their investors that they've made a sound acquisition deal, and encourage non-investors to buy their stock, so I wouldn't read too much into it.

In the last year-and-a-half, Image's arthouse/foreign/silent releases have slowed to a trickle (according to their website, they released ZERO silent titles in 2004). Instead, they've been appealing to the lowest common denominator by releasing huge numbers of cult horror, sports, music, softcore T&A, and Spanish language titles. Their most noteworthy releases have been in the area of TV-on-DVD, especially season sets of Dick Van Dyke and Twilight Zone.

Given their change of focus, I wonder if they have the talent in place to produce quality titles for the HVE label, let alone market the Criterion Collection.

"Hello? Yes, I'd like to order the Fassbinder BRD Trilogy boxset, Cries and Whispers, Tokyo Story, and one copy each of Midnight Plowboy and Hip Hop Honeys: Tasty Flavors. Could you mail those in a plain brown wrapper please?"

[BrightEyes23]

These are business press releases, specifically aimed at potential investors in the company...do you really think that going into detail about if they're going to keep the same type of quality for the DVDs, if they're going to maintain the same effort into transfers, etc. is going to interest you're target invester? No way. They WANT to hear "Revenue." This is all a business after all.
With them bringing the former CEO of HVe over, I speculate that they will take just as much time and effort to go into each and every product as HVe itself has in the past, because they're not stupid. They know the reason HVe was doing so well was because of said quality. Otherwise, don't you think they would've targeted someone like say...New Yorker who has a MUCH MUCH more extensive catalog that if released could be a major major cash cow? They know that New Yorker has a bad reputation and their revenue streams probably show that very fact.

You treat your investments right and maintain the same quality they came in as you bought them, otherwise, their value goes down and it's a bad purchase.
You don't buy a Micky Mantle game worn jersey and then wear it out to a barbeque kegger do you?

[Michael Kerpan]

Lots of companies make expensive acquisitions, and then run the assets they acquired into the ground through mismanagement quite quickly. I don't believe the management of Image has the smarts to handle this acquisition effectively -- and I don't think Image's stranglehold over the distribution of Criterion's releases will be a good thing either.

I will be pleasantly surprised if this doesn't turn out to be a fiasco .

[analoguezombie]

Any dvd company that lists 'Foriegn' as a genre is suspicious to me.

So, I take it that your suspicions have you looking over your shoulder evry time you enter a retail establishment to purchase a DVD?

If you're that scared...but a dog.

Tribe

I don't think it bodes well for a film/dvd distribution company to place every film not made by an American company as 'foreign'. It doesn't really instill faith in their ability to accurately market, release, restore, or otherwise have anything to do with the myriad and wealth of world cinema.

all bickering aside, I do not understand how anyone can think this is a positive turn for HVe. Image is notorious for their lacklustre quality. Plus they are moving HVe to their California headquarters, closing Hve's chicago offices. Most of Hve's staff is being cut. It's so obvious that what Image is hoping to do by turning HVe into their 'specialty' label is to tap the cineaste market. Given their track record I cannot imagine the quality and brand that HVe has become will remain intact. It's just not going to happen. Warning bells are ringing. I see absolutely zero news to make me think to the contrary.

I'm just glad the Fukusaku titles I was excited about have already been released.

[Tribe]

Lots of companies make expensive acquisitions, and then run the assets they acquired into the ground through mismanagement quite quickly. I don't believe the management of Image has the smarts to handle this acquisition effectively -- and I don't think Image's stranglehold over the distribution of Criterion's releases will be a good thing either.

I don't know for sure, but I don't think that Image entered into this deal to make a quick profit and run. Otherwise, why shell out (or go into debt, rather) to the tune $8 million, which I think in turn caused the lowering of their quarterly projections (not certain, but the news on both items came too close together to think otherwise), shell out another big chunk of money to Criterion for the right to distribute them (I don't know if that is something common in the industry or not, paying for the rights to distribute), and on top of all that enter into a non-compete agreement with the head of HVE, and pay her, just to milk it dry?

It appears to me that if Image is going to hang on to the HVE name, which is known as a specialty label, it's going to keep the course. It just wouldn't make business sense otherwise.

And why would Criterion, which rightly or wrongly has achieved pre-eminence in the DVD world, associate with an outfit that is gonna hurt its brand?

Of course, I'm assuming we're talking about rational business people.

Tribe

[peerpee]

Image seem good at distributing and, ahem, less good at making DVDs --- but what really jars here is how they hope to continue the HVE brand by laying all the staff off. Those 40 people are the brand.

Imagine New Yorker buying Criterion, laying off all the Criterion staff and trying to continue the Criterion brand themselves (god, what a nightmare).

[ben d banana]

Keeping the head of the purchased company on the payroll as consultant is pretty standard procedure and is far from a guarantee of continued quality, just as forking over a sizeable sum of cash to acquire another company ensures the purchasee won't run the original company, or both, into the ground. I'm in the midst of watching this happen in my industry and friends are involved. I definitely agree w/ Perpee, the staff is the brand for HVE.

I'm not too concerned about Criterion at this point, and I'm sure we'll hear if they start getting the squeeze. It probably just sets up a unified switch to whichever forthcoming hi-def format the companies choose.

[Faux Hulot]

Image COO David Borshell noted that this is Image's first acquisition of an independent video company and the company's first acquisition since the 1999 purchase of online retailer DVD Planet.

Oh dear... just today I was reading customer reviews of DVDPlanet at dvdpricesearch.com and the scuttlebutt wasn't good. For instance, one gent writes:

Reviewer: Jeff of Minnesotta      2005-06-29

Caveat Emptor

Ken Crane's Laserdisc, a company just north of LA was a GREAT company to deal with. They had great customer service, and I ordered a lot of stuff from them, and when I did have an issue, it got resolved fast.

As DVD's caught on, Ken Crane's became DVDPlanet. Same folks, same location, (They have a retail store) but differant name. Still wonderful to deal with.

Recently, in the last year I believe and as I understand it, DVD Planet sold their online side to some big company out of Chicago. The reatil stoe is still the same folks, but the online side is not.

Since then I have had several problems, one involving an new item, Boxed set, (Best of Hitchcock #1) which I received and had already been opened. Furthermore, instead of one of ewach movie, there were two of the same movie, and of course one was missing. They did return and refund my money but they did not ultimatly have another in stock as they promised.

I have had orders mysteriously cancelled, items that the website has in stock, which I have ordered, and in fact been told on the phone they have in stock, yet never ship. When I call back another clerk informed me that they had had that item for months....etc.

*sigh*

Anyway, in summation, DVD Planet is not the friendly, customer service oriented place they once were.

"*sigh*" indeed... keep your fingers crossed.