(January 15, 2020) Facing rapidly declining disc sales and the shackle of operational costs, Warner Bros. and Universal have announced a proposal to join forces for up to a decade. Earlier today, the two media giants issued a press release detailing plans to merge their North American physical media operations under a joint venture company. Pending approved by the United States government, this company will become fully operational during Q1 2021.
The North American joint venture directly affects operations in both Canada and the United States, where the it will handle sales, retail marketing, and distribution for DVD, Blu-ray, and 4K UHD discs. Each studio will continue to manage their digital distribution businesses separately, while also retaining content and consumer marketing for both physical and digital realms.
“As the home entertainment landscape evolves, we are continuously working to deliver the best entertainment range and value to our fans,” said Sanders. “The physical business is still an important and active category for the industry. This proposed joint venture with Universal gives us the best opportunity to foster innovation in this business, optimize the physical offering and extend the lifespan of the format for our fans and consumers.”
Outside of the North American joint venture, Warner Bros. and Universal are also combining forces for foreign operations during Q3 2020 and Q1 2021. Under this agreement, Universal will distribute Warner Bros. physical discs in Germany, Austria, Switzerland, and Japan, while Warner Bros. will distribute Universal discs in the U.K., Italy, Belgium, the Netherlands, and Luxembourg.
This, of course, is positive news for fans of physical media, as pooling resources allows the companies to remain committed to disc formats despite deteriorating market conditions.