I can’t help but wonder if the recent news at Dreamworks and Pixar is in some way related to the Internet, Tivo, and other disruptive technologies. Could it be that people are watching Shrek 2 on Tivo and saving that on Tivo for future viewing? Could it be that other activities, such as Internet usage, is infringing on DVD time?
There is another big issue. Why, in 2005, are we creating "inventory" of a digital good that can then be returned and cause an earnings miss? Why not VOD, or at least "print on demand" at Best Buy and Tower Records. Or at the very least, only recognize revenue on sell through. This seems like a 1980 problem raising its head 25 years late.
Perhaps Amazon can solve the problem…