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The Wall Street Journal Education Program
Weekly Review Quiz
Covering frontarticles from Sep 2-8, 2006
Professor Guide with Summaries Fall 2006
Developed by: Scott R. Homan Ph.D., Purdue University
Questions 1 – 10 from The First Section
In Hollywood, The Picture Blurs For Studio Profits
By MERISSA MARR
September 2, 2006;?Page?A1
/article/SB115716089734652490.html
Hollywood is bracing for what may be its toughest period in years.
The industry finds itself caught between two eras and powerful forces. Sales of DVDs -- the growth engine that propelled the film industry to strong profitability in recent years -- began to slow last year and that market is now considered fully mature. Yet there is nothing on the immediate horizon to replace that gold mine. Even the arrival of new high-definition DVDs is expected to have modest impact on the industry.
The most tantalizing prospect, distribution of movies over the Internet via downloading services, remains distant as a meaningful revenue source. Meanwhile, the studios are scrambling to avoid the problems the music industry faced when a mass of free online content threatened to blow apart its business.
Amid the changing environment, powerful players outside the entertainment industry -- like Wal-Mart Stores Inc.s -- are throwing their weight around Hollywoods clubby turf.
Recently, for example, the major studios opened negotiations to provide movies to be played on Apple Computer Inc.s video iPod -- an important step toward Hollywoods digital future. Then Wal-Mart, the biggest seller of DVDs, disrupted the talks when it delivered a pointed warning to the studios not to give Apple a better deal for digital movies than the retailer gets for physical copies.
Our conversations with the studios are about what Wal-Mart has always been about -- giving our customers the best value and selection, said a Wal-Mart spokeswoman in an email response.
To preserve profits, Hollywood is slimming its bloated infrastructure. Studios ar
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