-183-
wholesale price per unit for the EBD film titles.132 On the basis
of discussions with industry participants, Mr. Wagner opted for a
3-year release pattern (on average, just under two film titles
per month) for the EBD film titles.133 Mr. Wagner also opted for
an even release pattern for each title for each genre; i.e., if
there were 9 horror film titles, then 3 horror film titles would
be released each year. On the basis of discussions with industry
participants, Mr. Wagner determined that 80 percent of a film
title’s revenue would be received in the first year of release
and 20 percent would be received in the second year of release.
Incorporating these figures, Mr. Wagner computed gross sales
data for the EBD film library on title-by-title and year-by-year
bases.
ii. Cost Projections
Mr. Wagner projected costs for distributing the EBD film
titles including VHS conversion, duplication, distribution
(including shipping and packaging), cover art, and marketing
132 Mr. Wagner projected a lower $47 wholesale price per unit
for the less well-known actors/horror genre, because distributors
had lowered prices in 1996 to induce additional unit sales in
this category.
133 Mr. Wagner determined that for a typical release pattern,
a distributor releases up to three film titles per month
depending on the other film titles that the distributor is
releasing.
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