VSDA show lacks sparkle: attendance down 15%

Discount Store News, July 27, 1998 by Laura Heller, Robert Scally

Which is just as well, according to several exhibitors, who told DSN that it's time the VSDA show refocused on business.

According to Paramount spokeswoman Dorrit Ragosine, it was "a good working show." Ragosine attributed meager crowds to the fact that retailers were not staying for the duration of the show and that each day brought fresh faces.

Of course, for Paramount it most certainly was a good working show. The studio is releasing "Titanic" to home video on Sept. 1, and its booth in the form of a ship drew continuous crowds. Attendees could have their picture taken, and through digital photography, appear to be on the hull of the doomed ship.

But the bulk of attention at the VSDA show was paid to the concerns of retailers, with representatives of most of the major mass merchant chains circulating quietly from one private meeting room to another, avoiding the show floor.

In addition to its booth, Fox Home Entertainment showcased interactive, rental and sell-through properties together with licensed merchandise in is meeting set-up as a store environment. Steve Feldstein, a Fox spokesman, said the setup was meant to refocus attention to the businesses at hand: sell-ing product.

Several exhibitors privately groused that the VSDA may be heading the way of the music business' main convention, NARM, where almost all of the real business of the convention takes place off the show floor.

Primarily, the show served to spotlight the increasing tension between independent video rental store operators and the growing superstore chains.

Revenue sharing programs and exclusionary deals among studios and the large chains were the main topics of conversation. A group of dissident independent retailers is threatening to form a splinter video organization to raise funds to sue Blockbuster and one or more of the major studios for restraint of trade and price fixing in pricing deals that have allegedly been offered exclusively to Blockbuster.

Similar but less prevalent grumbling about favorable pricing on sell-through titles with mass merchants such as Wal-Mart could also be heard.

In a speech to the VSDA's membership, Blockbuster chairman and ceo James Antioco emphatically denied that Blockbuster has any special deals with studios.

Antioco, who turned Circle K around, said that many of Big Blue's problems have been fixed and the chain is again returning to profitability.

While VSDA president Jeffrey Eves called for unity in the organization and appointed a special task force to study the concerns of independent retailers, numerous veteran industry observers pointed out that attendance at this year's convention was well below that of past years. The VSDA confirms a drop of approximately 15% over last year with a little more than 10,000 attendees.

But despite intense competition from major chains and new entertainment technologies, enough independent rental retailers are still in business to make the VSDA convention a necessary stop for the major studios. The need to consolidate business meetings with large chains in a single location is also likely to keep the convention going strong.

Next year, the show returns to Los Angeles and will be shortened to three days from its usual four-day run.

Despite the controversies swirling around the convention, numerous high quality titles are on the way to market. In addition to "Titanic" from Paramount, other titles to watch for during the next six to nine months include "Small Soldiers" from DreamWorks; Cats" from PolyGram and "Lion King II" from Buena Vista.