Retailers Riled by Price Tag on ‘Ghost’

“Ghost,” the romantic comedy that grossed more than $210 million and ranks 10th on the all-time list of moneymakers, is coming to home video March 21. Paramount Home Video said Thursday that it will be priced at about $99.95--a decision that immediately generated furor among video retailers who would rather sell it than rent it to their customers.

Paramount’s announcement ended speculation that the movie, which stars Patrick Swayze, Whoopi Goldberg and Demi Moore, would be priced in the $20-$25 range for the sales market.

“ ‘Ghost’ was the perfect title to release at about $20,” said Peter Margo, executive vice president of the Palmer Video chain. “It has mass appeal. It’s something men, women and teen-agers would like. It made well over $200 million at the box office, which means many people saw it again and again. That high repeatability factor means people would like to own their own copy and watch it whenever they want.”

Eric Doctorow, executive vice president of Paramount Home Video, said that the company felt that releasing it in the $20-$25 range was risky because of the instability of the retail market.

“Given the war and the recession, people might not be into buying a tape--no matter how good it is,” he said. “In a recession, consumers get cautious. They buy less. We were concerned about that.”

Though Paramount puts no suggested retail prices on its cassettes, Doctorow said that the wholesale price for “Ghost” will be equivalent to that of the studio’s “The Hunt for Red October”--about $65-$67, with a projected retail price of $99.95.

Margo estimated that Paramount would ship more than 500,000 copies of “Ghost’ and gross more than $30 million.

But he and other retailers complained that the high wholesale price will prevent them from buying as many copies as they would otherwise--meaning consumers will have fewer available to rent--and may also force them to charge a higher rental fee.

“What Paramount is doing isn’t in the best interests of the industry,” said George Rogers, vice president of video buying for the 260-store Wherehouse chain. “A price rise is bad for the industry. It ultimately hurts the consumer. At a higher price, the retailer buys fewer copies, so it’s harder to meet consumer demand. Also, when prices rise, the retailer eventually passes it on to the consumer in terms of a rental price increase.”

One retailer, Frank Lucca, president of Flagship Entertainment, which has 622 outlets, defended Paramount. “We were all afraid that they would raise the price of all their tapes to $100, but at least they haven’t done that,” he said.

Lucca, who led a protest when Paramount priced “The Hunt for Red October” so high, said that while he’d rather the studio offered “Ghost” at a lower price, retailers have only themselves to blame.

“They accepted the high price on ‘Hunt,’ ” he pointed out. “If they had cut orders drastically, that would have sent a message to Paramount. Now Paramount is pricing ‘Ghost’ high because they know retailers will pay it.”