THE DETERMINANTS OF MOVIE RENTAL REVENUE EARNINGS

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                   THE DETERMINANTS OF
              MOVIE RENTAL REVENUE EARNINGS

                        Neil Terry, West Texas A&M University
                    De’Arno De’Armond, West Texas A&M University

                                            ABSTRACT

       This paper examines the determinants of m
				
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Description: This paper examines the determinants of movie rental revenue in the United States. The sample consists of 214 films released during 2006. Regression results indicate the primary determinants of video movie revenue are domestic box office, time to video, academy award nominations, sequels, children's movies, and domestic release exposure. Specific results include the observation that domestic box office revenue serves as a complement to movie rental revenue and time to video is inversely related to video revenue as motion picture companies take advantage of marketing economies of scale. Branding associated with an academy award nomination is worth over a million dollars in rental revenue and sequels are worth six million less than alternative releases. Children's movies are worth ten million dollars less in rental revenue than other releases, as parents appear to buy over renting children's movies. Critical acclaim, foreign box office performance, and budget are determinants that have a positive but statistically insignificant impact on movie rental revenue. [PUBLICATION ABSTRACT]
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