DVD sales fell 3.2% last year and Warner Bros. is scared they might go down even further. Brainstorming for new ideas, the studio thought of their new $100 million project ‘Watchmen’ — director Zack Snyder (’300′) originally wanted $150 million, but Warner asked him to pretty please keep the costs below $100 million. A side story to the comic book movie ‘Watchmen’ will be released on DVD, 5 days after ‘Watchmen’ hits the theaters. Kind of like a cross-promotion, since the DVD shelf space will sell tickets and the other way around.

It also gives Snyder the possibility to release three DVDs. The first will be the side story, called ‘Tales of the Black Freighter.’ The ‘Watchmen’ DVD will follow four months later. And lastly, he plans to make an ‘ultimate’ DVD, combining the two into one film. “The überfans of this property are going to go crazy for that,” Snyder said. He’s also scared he will lose some precious moments of ‘Watchmen’ before the final cut, which would create some extra material for the ‘ultimate edition.’ “The main picture is nearing three hours long and I know I have a fight on my hands just with that.“

‘Watchmen’ will be in theaters March 6, 2009.

DVD players to be exact, not discs. It will be a couple of years before Blu-ray discs could even begin to outsell DVDs. But since the HD format war has ended early, the demand for Blu-ray players has been outstripping supply, according to retailers. They expect this shortage to go on until August, when the big electronic manufacturers will launch their new Blu-ray players.

“People have been waiting weeks for Sony players, but it should get better later in the summer. In August, it will be the first time that Blu-ray overtakes [standard DVD] sales for us on a unit basis,” retailer Crutchfield said. The Blu-ray players already overtook DVD players in dollars spent at Crutchfield, with 60%/40%. Electronics retailer Bjorn expects their unit sales to shift from 70%/30% to 90%/10% by the end of the summer. “Everyone is trying to assure us the supply is going to get better. Right now it’s a hindrance,” owner Bjorn Dybdahl said.

Of course most of this is anecdotal evidence, but these words are much more positive than the 40% drop in Blu-ray player sales we heard about a couple of weeks ago. Followed by the lower Blu-ray discs sales later that week.

Apparently some people would disagree if a say ‘Untraceable’ is not worth your popcorn. Sony Pictures’ $35 million crime thriller wasn’t a major success in theaters. It grossed $28 million domestically and managed to add another $22 million overseas. But it did make the number one spot in DVD sales last week, beating the $15 million ‘The Great Debaters’ with Denzel Washington and Forest Whitaker.

‘Untraceable’ came in second for rentals, doing $6.9 million. The $22 million Diane Keaton comedy ‘Mad Money’ came in first, with $7.3 million in rentals. The number one from last week, ‘P.S. I Love You,’ added another $5.9 million in rentals, making a total of $13.1 million. And lastly, the first ‘Chronicles of Narnia’ movie topped the Blu-ray chart, with ‘Untraceable’ coming in second. All those numbers are making me dizzy.