Will Pay-Per-View Meet Predictions?

When the premieres of “Batman” and “Dick Tracy” were heralded on HBO and Showtime, it wasn’t really their first time on television. Like most feature films, those movies already had aired weeks earlier on pay-per-view services.

Pay-per-view is routinely the stop feature films take after they have been at the video store for a month. It’s becoming a force in the cable industry, reaching 16 million U.S. households, 17 percent of all homes with televisions, with 3 million more homes predicted to be added by year’s end.

“Pay-per-view has taken huge strides, but it’s nowhere near where it is going to be,” said Lloyd Werner, president of Request Television. Available in 8.5 million homes, the six-year-old Request, Werner said, is beginning to turn a profit. And, according to media analysts Paul Kagan Associates, projected pay-per-view revenues will be approximately $781 million by 1995.

Request and Viewers’ Choice are the two major pay-per-view channels. Smaller services include Cable Video Store and the adults-only Spice and Playboy at Night.

Viewers who have pay-per-view on their cable system may order a movie, concert or sporting event by calling a computerized order-entry telephone number or by ordering through a customer service representative. The most advanced technology allows the subscriber to press selected buttons on a remote control.

Generally, subscribers pay $3.95 to $4.95 for a movie, $14.95 to $19.95 for a concert and $19.95 to $35.95 for a major boxing match.

The real money in pay-per-view is the events. Werner said that 1.6 million subscribers paid $35 or so to see the Tyson-Ruddock fight--total receipts were $45 million; the Holyfield-Forman match did $50 million.

Movies, Werner said, don’t perform as well as sporting events. Just 4% of homes with pay per view actually purchase movies, an average of just two per year.

“To make this a huge business we have to grow to 35 million homes and double the amount of purchases from two or four,” he said. “The price (per movie) then will be $5 and that would be $700 million in movie purchases.”

There have been discussions about pay-per-view networks presenting cultural events and even producing their own movies. “It’s possible, if you could produce movies at a low-level, not like $92 million ‘Terminator 2s.’ Pay-per-view would simply give you another pay day and that is all pay-per-view really is, another window in the stream of revenue for the studios.”