Toei, Japan's leading video rental distributor, is to follow the example set by Blockbuster last year (Screendaily Sept 12, 2001) and shift its focus to DVDs.

The company plans to release 30 classic film titles on DVD and place them, along with its existing DVD library in 4,000 rental outlets by April, compared with the 2,700 stores that currently stock its product.

Among the new DVD releases are Abashiri Jail, Red Peony Gambler and other classic Toei gangster films from the 1960s, as well as recent theatrical releases such as the controversial hit Battle Royale and the critically acclaimed Go.

Toei will release the titles, chosen by consumers in a survey, starting in mid-April. By the end of the year it plans to have released a total of 200 new titles, for both sell-through and rental. Meanwhile, the ten video sales companies in its corporate group are aiming for a 50% increase in client shops over the next two months, sweetening the deal by offering stores three-year leases for only $38 (Y5,000) per title - about half the current price.

Toei subsidiary Toei Video pioneered the straight-to-video film business in Japan in 1989 and has dominated it ever since. Toei entered the DVD rental market in October 2000 and DVD now accounts for 15% of its sales to rental shops. The company plans to increase this figure to 40%.

In a related development, Asahi National Broadcasting, one of Japan's five TV networks, has purchased 2.7 million Toei shares from Sumitomo Mitsui Banking, giving it a 1.8% share in the company. TV Asahi invested in Toei as part of its strategy of building its film content business. On February 19, the day TV Asahi announced its purchase, Toei shares leapt to $2.93 (Y329) on the First Section of the Tokyo Stock Exchange, up from a ten-year low of $2.24 (Y300) on February 6.