Rentrak signed DVD revenue-sharing agreement with MGM Entertainme...
Rentrak signed DVD revenue-sharing agreement with MGM Entertainment that added revenue to 3rd quarter earnings, but wasn’t enough to offset decline in overall sales to $26.4 million from $32.8 million. Despite downturn in sales, Rentrak net income increased to…
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$2.2 million from $229,510 as it benefited from final $1.5 million payment from Rentrak Japan. Rentrak’s DVD revenue-sharing agreement with MGM generated revenue in Nov.- Dec. and company is attempting to land similar agreements with other studios. Rentrak has revenue-sharing pacts for VHS with all studios except Columbia TriStar. Total entertainment business revenue slipped to $20.7 million from $26.4 million as company shipped 757,189 VHS cassettes and 120,082 DVDs. Rentrak’s 3PF fulfillment operation, whose customers include Red Envelope.com, reported $503,505 profit in quarter, reversing year earlier $329,210 loss despite decline in revenue to $6.4 million from $7.5 million. Revenue downturn was tied to bankruptcy of customer CyberRebate.com, which accounted for $2.4 million in revenue in year-ago quarter. Meanwhile, testimony in complaint 3PF filed against Hollywood Entertainment with American Arbitration Assn. (AAA) was completed this week with decision expected by spring, company said. 3PF had filed complaint with AAA in Nov. 2000 alleging breach of contract and seeking $4.7 million in connection with Hollywood Entertainment’s former Reel.com business. Latter was shut down in mid-2000. Rentrak also is seeking to sublease and/or sell lease to 3PF’s 388,264- sq.-ft. warehouse in Columbus, O., while maintaining 2 others in Wilmington, O., CEO Paul Rosenbaum said. Meanwhile, Rentrak is moving to open new revenue stream with plan to license software. Among software is Essentials, a real-time online inventory tracking system, and Fastrak, technology that company uses to “capture” rental transaction data at video stores and transmit it to studios as part of its pay-per-transaction (PPT) business. Rentrak forecast it would gain software licensing revenue in fiscal 2003, but declined to provide details. Goal is to expand Rentrak software into other retail channels, Rosenbaum said.