SHARED-REVENUE VIDEO PROGRAM GAINING FAVOR

DAN ALAIMO

DALLAS -- More major retailers have warmed up to the shared-revenue, pay-per-rental concept since Walt Disney Co., Burbank, Calif., acquired SuperComm here in December. About 30 companies are now testing or using the video program, up from 24 at the time of the acquisition, said Des Walsh, vice president and general manager. Walsh would not reveal the names of the retailers, but said the additions include divisions of national chains and significant regional retailers, some of which would not consider shared-revenue prior to the Disney acquisition. "Based on our current success, we believe that the vast majority of the major supermarket video retailers will be either testing or otherwise participating in the SuperComm program by the end of the year," said Walsh. According to distribution sources, retailers known to be testing or using the SuperComm system include Randalls, Pathmark, Safeway, Kroger, Winn-Dixie, King Soopers, Fleming, Price Chopper, Dillon's, Haggen, Fiesta Mart, Nash Finch, Marsh, Harp's and Food Giant.

The number of stores now active in the program is up to about 1,000 from 800 in December, he said. In terms of potential use of the program, the total number of stores with video rental departments run by these retailers is about 1,800, up from 1,200 in December, said Walsh. Shared-revenue, pay-per-rental is a method of purchasing rental-priced videos that retailers can use in addition to buying tapes from traditional video distributors. Under such a program -- which is also offered by Rentrak Corp., Portland, Ore. -- retailers pay $8 to $12 to acquire videos and then share the rental revenue 50-50 with the supplier, which, in turn, shares the revenue with the studio. Transactions are tracked electronically. The alternative is to pay $65 to $70 for a copy and keep all the profits. Shared-revenue allows retailers to dramatically increase their presentation of new releases, he said.