Moser Baer to extend price war to new films

Optical storage maker Moser Baer is extending the price war in the home video market to new titles and films.

The company, which started by selling DVDs of old films for only Rs 34 and VCDs for Rs 28, will retail at the same price titles of new films "� such as Apne starring the Deol trio (released last Friday), Vikram Bhatt's Life Mein Kabhi Kabhi and Quartet Films's Ek Chalis Ki Last Local (both released this year).

Responding to the move, competitors like Shemaroo Entertainment, T-Series and Ultra are also dropping prices of recent releases and of older films even further.

T-Series is all set to offer this year's multi-starrer release Salaam-e-Ishq's DVD for Rs 45.

Shemaroo Entertainment, a leading home video company known to have titles priced as high as Rs 499 (for premium products) and others in the range of Rs 300-400, is giving a flat 50 per cent discount on all its titles, include films released last year, like Family, and older films like Zeher and Kalyug.

"At present, we are running a monsoon promotion scheme under which we have reduced prices for all our existing titles. The real test for players will be when Moser Baer releases new titles. For instance, when it introduces Apne, we may have to follow suit if the sales volume is substantially high," said Atul Maroo, joint managing director, Shemaroo Entertainment.

Ultra has also dropped prices of some movies to Rs 99, which include the critically acclaimed Iqbal (released in 2005 and earlier priced at Rs 499) and Apna Sapna Money Money (released in 2006 and earlier priced at Rs 349).

"We have lowered prices and set a sales target (across India) of 3 lakh DVDs for 300 titles, to be achieved by the end of July," said Susheelkumar Agarwal, managing director of Ultra Group.

No doubt, relatively new films, especially blockbusters, are getting in the moolah. This is reflected in Moser Baer's success in selling the mega hit movie Munnabhai MBBS (released in 2003). According to Harish Dayani, CEO, Moser Baer Entertainment, the company has sold over 4,00,000 DVDs in just two months.

Music retailers are not complaining. "Our store sells almost 150 DVDs and VCDs of Moser Baer per day, against 75-80 DVDs and VCDs of other companies," confirmed an executive of Rhythm House in south Mumbai.

Retail store owners also say that as Moser Baer is playing a volume game, it has made it mandatory for a store to place an order for at least ten DVDs and VCDs of one title, unlike other players.

But Moser's competitors are also sceptical about its strategy. "We have been in the business for years and our distribution network is stronger and more widespread. Moser Baer is playing a volume game and so the retailers' margin is low, which it isn't in our case. Therefore, we have a far larger grip on distribution," said Bhushan Kumar, chairman & managing director,T-Series.

But with Moser Baer improving its distribution network and grabbing new film rights, the battle will surely be action-packed.