2008 Press Coverage
NPR – National Public Radio: 12/27/08
Distribution Video and Audio is the last major supplier of VHS tapes, and it's ceasing distribution (of VHS tapes) at the end of the year. Co-owner Ryan Kugler talks with Scott Simon about the end of video tapes.
The Early Show on CBS: 12/24/08
Engadget: 12/23/08
VHS distribution grinds to a halt
We already gave VHS a proper burial after JVC became the last firm to shut the door on VHS player production, but there was still one nail in the coffin that wasn't quite hammered shut. Today, it all ends. The last notable distributor of VHS films -- Distribution Video Audio out of Palm Harbor, Florida -- has shipped its final truckload of tapes, probably to a small town library or a mom 'n pop shop in a place you'll never hear of. According to co-owner Ryan J. Kugler: "It's dead, this is it, this is the last Christmas, without a doubt." An unceremonious way to exit, sure, but we have a sneaking suspicion that it'll one day be able to say it made it longer than practically every other physical film format that succeeded it. Here's one last tear for the format that was -- now, time to plan a trip to the local flea market.
Los Angeles Times: 12/22/08
VHS era is winding down The last big supplier of the tapes is ditching the format, ending the long fade-out of a product that ushered in the home theater.
Geoff Boucher"It's true, one man's trash is another man's gold," Kugler said. "But we are not the graveyard. I'm like a heart surgeon -- we keep things alive longer. Or maybe we're more like the convalescence home right before the graveyard."
Washington Post: 12/19/08
Where old DVD formats go to die: Entertainment media liquidator says their days are numbered
Scott GalupoIf you happen by the discount bin at Wal-Mart or a gas-station market, there's a better-than-average chance it originated from one of DVA's two giant warehouses outside Tampa, Fla. (The company temporarily rents storage space in other regions, as needed.)
What Would Toto Watch?: 12/17/08
Where do misfit formats go?
We are still finding new customers who want DVDs or CDs to sell in stores and entertainment products do well in a recession/depression. Look at the movie business in the 1930s. That’s when it started and really grew.
City of Los Angeles: 12/12/08
Certificate of Commendation
SOS Warehouse Sale: 12/6/08 & 12/7/08
Kansas City Star: 12/06/08
Company Digs Up Excess (and old) Inventory and Sells it in Bargain Bins
Robert W. Butler“We like to say we’re in the business of life after death. We take products that the manufacturer can no longer sell and market them through secondary locations. I’m talking about everything from truck stops to flea markets to car washes. Chains like Dollar General and Big Lots. Grocery chains … mom-and-pop stores all over the planet."
AliBaba.com: 12/02/08
Salvaging the Holiday Shopping Season
Editor: Zoe Zhang"Entertainment does well in recession because people want to get away from the stock market and the news," says DVA president Ryan Kugler. "The economy has affected us in a positive way. The retailer is looking for a deal, and when they can buy a movie from us for a buck or two, they can't go wrong."
MovieMaker Magazine: Fall 2008
Hollywood's Not So Dirty Little Secret
Kyle Rupprecht"There are challenges that face the industry. DVD sales have flattened as people are confused by the marketplace. The format war with Blu-ray and HD DVD confused the customer and many don't understand why they should by buying Blu-ray at a higher price point when they already have a DVD player at home. An education process will be required so people understand what the value of the new format is and why it's worth paying a higher price."
Entrepreneur: 11/24/08
Salvaging the Holiday Shopping Season
By Dennis Romero"Entertainment does well in recession because people want to get away from the stock market and the news," says DVA president Ryan Kugler. "The economy has affected us in a positive way. The retailer is looking for a deal, and when they can buy a movie from us for a buck or two, they can't go wrong."
New York Times: 11/21/08
DVDs, Hollywood’s Profit Source, Are Sagging
By Brooks BarnesWeak consumer spending is not the only culprit. Media companies, desperate for revenue, are dumping more obscure titles on the market, leading to downward pricing pressure, according to Distribution Video and Audio, as digital downloads are cutting into sales.
Daily Titan: 10/14/08
Reel World Experience
By Ashley Landsman“I found that a lot of people make movies, but the movie fails,” he said. “There’s never that final piece of the puzzle to teach you what to do with a film once it’s made.” back to top
Washington Post: 10/05/08
Bells And Whistles In Search Of An Audience
By Mike Musgrove, Technology ColumnistAlthough movie studios aren’t releasing new content on the format, leftover HD DVD movie discs now retail for about $7, said Ryan Kugler, president of the Los Angeles-based Distribution Video & Audio, a company that buys surplus entertainment media inventory and resells it to discount retail chains.
Electronic House: 09/30/08
HD DVD Still Has Steam: A new report says that the defunct high-def format is still doing decent sales.
By Rachel CericolaRyan Kugler, president of Distribution Video & Audio, said that his company scarfed up many of the HD DVDs that retailers returned to the studios—only to sell them off to those still using the hardware. “Cheap entertainment always does well in a recession or depression,” Kugler said.
Financial Times: 09/29/08
HD DVD slashed prices drive sales up
By Matthew Garrahan in Los Angeles“Cheap entertainment always does well in a recession or depression,” he said.
Variety: 09/29/08
DVDs start making cents: Websites selling movies for cheap
By Daniel Frankel"The Matrix" grossed more than $460 million in worldwide B.O., spawned two sequels, revolutionized visual f/x technology and kickstarted the careers of the Wachowskis. But visit movies4wholesale.com or any number of other online DVD wholesalers and you can readily buy the film on disc for around $3.50.
Visit closeoutvideo.com and you can also peruse onetime awards contenders like "Before the Devil Knows You're Dead" and "Lars and the Real Girl" -- available for less than $7.
Clearly, the wholesale business for recorded movies is booming. But will this discount dynamo cut into Hollywood's library values?
Ryan Kugler, prexy and co-owner of Distribution Video & Audio, which operates closeoutvideo.com, says his operation is set to distribute 20 million titles this year, up 10% from 2007. He's finding plenty of inventory to sell right now, with studio homevid divisions often overshooting the mark on their shipment numbers and offloading the excess to wholesalers.
A small but considerable number of top titles are also still floating around on VHS and the now-defunct HD DVD format.
"We're buying this product for under $2 a unit and we'll make 10 to 15 points on average," says Kugler, who sells some of those tapes and discs directly to consumers on sites like dvdcloseout.com. Most are sold in bundles of hundreds or even thousands to other online direct-to-consumer wholesale operators, many of which do their thing on eBay.
With more and more bargain-conscious movie-buyers discovering these sites in a tight economy, sales have been brisk. Kugler estimates the U.S. DVD wholesale market is worth somewhere around $1 billion annually.
Harder to estimate, however, is what the effect is to studio libraries.
Studio homevid execs tout emerging formats like Blu-ray and digital downloads as the future of post-theatrical distribution, upholding the margins for new releases and older film and TV titles alike as movie buyers switch over to the newer technologies and leave behind the old ones.
But with Wall Street in turmoil and consumer confidence at generational lows, the question remains: How many more times can pics like "The Matrix," be sold on Blu-ray and on cable when consumers can buy them on VHS on eBay for 99¢?
Home Media Retailing Magazine: 9/3/08
DVA Celebrates 20th Anniversary
By Kyra KudickDistribution Video and Audio (DVA), one of the largest buyers and sellers of excess video and audio inventory in the United States, celebrates its 20th year of operation this September.
The family-owned and operated business, which began in 1988 selling 100,000 units a year, has an account base of more than 350 companies and sells more than 20 million units per year, generating $20 million in annual sales.
"It's a tremendous accomplishment for any firm to be in business for more than 20 years," said Ryan Kugler, president of DVA. "Our achievements are even more significant when you examine the context of the entertainment industry and the radical changes that have taken place within it over the last 20 years."
DVA on Daytime/NBC TV: 8/11/08
AWARD: Gulfcoast 500 Largest Companies: August 2008
DESCRIPTION OF THE AWARD: Gulfcoast 500 Largest Companies
FOR WHAT WAS IT GIVEN: Being one of the 500 most successful companies on Florida's Gulf Coast (ranked by size and revenue)
WHO GAVE IT: Gulf Coast Business Review
DESCRIPTION OF THE ISSUER OF THE AWARD:
http://www.review.net/index.asp
Per their website - "The Gulf Coast Business Review is Southwest Florida's weekly newspaper for Trends, Companies, Entrepreneurs and Law."
This weekly paper covers the entire Gulf Coast of Florida, including: Hillsborough, Pinellas, Pasco, Manatee, Sarasota, Charlotte, Lee and Collier counties.
WHEN WAS IT GIVEN: August 2008
Link to Home Media Magazine article
Tampa Bay Business Journal
DVA responds to obstacles with change
Constant reinventing keeps video distribution rolling
PALM HARBOR — Brad Kugler, COO of Distribution Video & Audio, was still in school when his father, Ben Kugler, and a couple of partners bought the company, then known as Distribution Video Inc., for about $300,000 in 1988. Today, Brad Kugler has developed DVA into a $22 million company.
In its early years, DVA's primary business was providing VHS cassettes to Blockbuster Video stores throughout the nation. However, by the mid-1990s, the popularity of independent video rental stores began to wane, causing a radical shift in focus and the termination of 12 DVA employees.
Soon, DVA began buying overstocked, consumer-returned and liquidated items and filtering them through several distribution channels, including Internet retail, discount retailers and niche markets, such as schools, libraries and eBay sellers. The company has approximately 2,500 active customers but 80 percent of its profits comes from a handful of discount chains, such as Dollar General, Family Dollar and Dollar Tree.
Piracy has had no affect on DVA, Kugler said. In fact, its CD business has increased in the last year, as has its VHS market.
Kugler attributes this to the plummeting prices of such items, which allows him to sell them for even less. "If the world went digital, our business life would exceed a decade beyond that because it filters through our closeouts and reverse logistics."
During the dot-com craze of 1999 and 2000, DVA branched into the Internet, but just as orders began to reach their height, the company was again forced to cut back. "Obviously, there's some sex appeal in having a Web site and selling 5,000 orders a day and being some dot-com hero, but it was a nightmare," said Kugler.
Instead of hosting its own site, DVA began to sell its products wholesale to existing sites, and the business was quickly back on track.
Weathering ups and downs
Having weathered another storm, DVA launched its own label, First National Pictures, in 2005. Although the intention was to license titles and transform DVA into its own studio, the venture backfired, and the company ended up losing $1 million. After about a year and a half, Kugler abandoned the concept.
Each of these obstacles has caused DVA to re-invent itself, and Kugler said that they have helped the company grow. "Each time, we've sort of adapted and found a new revenue stream," he said.
Revenue has dropped 5 to 10 percent this year, but Kugler said that DVA remains at the top of the "entertainment liquidation business," though he's unsure of its market share.
"[During] our 20 years in the business, we kind of nailed down what's a good buy and what's not," said Kugler. "It's really all about the purchasing."
Technology rules
Gene Gross, owner of Video Group Distributors, sees plenty of opportunity in the industry. Video Group Distributors provides wholesale DVDs to merchants, drugstores, truck stops, convenience stores and kiosk rental machines.
"There is success to be had in that," he said. "It depends on the continued diversification of acquisitions through consumer price points."
One of the three original owners of DVA, Gross left the company in 1991 to start his own business. While his venture has continued to thrive, he acknowledges that the industry is in a transitional stage once again, thanks to the introduction of Blu-ray.
"What makes a difference is the willingness of management to persist in wake of these changes and adjust," said Gross.
As for the future of DVA, Kugler believes the company's growth may have reached a standstill, since its prospects have diminished.
"Being around this long, you've pretty much sold to everybody," he said.
The next step is to acquire a company that will complement DVA's services, an objective still in early development.
In addition, Kugler is keen to return to his goal of owning content and hopes to eventually consolidate DVA's 25,000-square-foot Palm Harbor headquarters and its 12,000-square-foot Clearwater warehouse into a single 50,000-square-foot property. It's all part of his plan to hit $50 million in annual revenue in the next five years.
"The challenge is always to buy correctly, especially in a down economy, because there's so much good product out there," Kugler said.
The harsh economy may make buying decisions tougher, but it has its advantages, at least for his industry, he said.
"We get a little pressure, but it's an opportune time because when there's a recession, people always like cheap entertainment, which is what we provide," said Kugler.
Info
BUSINESS: Distribution Video & Audio
ADDRESS: 133 Candy Lane, Palm Harbor
NATURE OF BUSINESS: Entertainment distribution
PHONE: 727.447.4147
WEB: dva.com
DV&A, Inc. on NBC's Daytime Show
Here is a great TV spot about DV&A that is both informative and entertaining… see the people and the place where you get your products!
First link is to YouTube and the second link is higher quality but requires QuickTime.
Enjoy!
http://gallery.me.com/braddva#100143
... and many thanks from the team at DVA!
Tampa Bay 2008 Fast 50: July 2008
DESCRIPTION OF THE AWARD: Tampa Bay 2008 Fast 50
FOR WHAT WAS IT GIVEN: Being one of Tampa Bay's 50 fastest-growing privately-held companies in 2008. Ranked by percentage of revenue growth from 2005 to 2007
WHO GAVE IT: Tampa Bay Business Journal
DESCRIPTION OF THE ISSUER OF THE AWARD:
http://tampabay.bizjournals.com/tampabay/stories/2008/06/23/daily10.html Tampa Bay's premier weekly business newspaper, part of parent company American City Business Journals, which has 41 newspapers across the country
WHEN WAS IT GIVEN: July 2008
The Bill Handle Show: 4/25/08
Content Agenda: 3/22/08
DV&A promotes business as green solution for overstocks
By Wendy Wilson"When a studio destroys product, they have to pay money to destroy it," he said. "So why not receive money from me for it, and then it goes back out into the marketplace?"